If the basket of goods and services used to calculate the CPI cost $200 in the reference base period and $450 in a later year, the CPI for the latter year equals
A) 325.
B) 225.
C) 200.
D) 450.

Question

Quizplus · Accepted Answer

The formula for calculating the CPI is (cost of basket in current year/cost of basket in base year) x 100. 
Using the information given, 
CPI = (450/200) x 100 = 225. Therefore, the correct answer is B.

If the Basket of Goods and Services Used to Calculate