Use the following to answer question 245:
-(Table: CPI)Use Table: CPI.Suppose only bread,laptops,and movies are produced in this economy.Calculate the consumer price index of 2012,using 2008 as the base year.
A) 81.9
B) 100
C) 75.8
D) 95

Question

Use the following to answer question 245: 
-(Table: CPI)Use Table: CPI.Suppose only bread,laptops,and movies are produced in this economy.Calculate the consumer price index of 2012,using 2008 as the base year.
A) 81.9 
B) 100 
C) 75.8 
D) 95

Quizplus · Accepted Answer

To calculate the CPI, we need to follow the given formula:
CPI = (Cost of Market Basket in Given Year / Cost of Market Basket in Base Year) x 100
Let's calculate the cost of the market basket for each year using the given data:
In 2008,
Cost of Market Basket = (10 x $2) + (1 x $1000) + (6 x $10) = $1060
In 2012,
Cost of Market Basket = (12 x $2.50) + (1 x $800) + (8 x $12) = $122
Now, we can get the CPI by dividing the cost of the market basket in 2012 by the cost of the market basket in 2008 and multiplying by 100:
CPI = ($122 / $1060) x 100 = 75.8
Therefore, the answer is choice letter C.

Use the Following to Answer Question 245