Table 24-12. Will's expenditures on food for three consecutive years, along with other values, are presented in the table below.
-Refer to Table 24-12. Suppose the consumer price index is 15.5 percent higher in 2011 than in 2009. Then Will's food expenditures for 2010 in 2011 dollars amount to
A)$6,352.
B)$6,380.
C)$6,426.
D)$6,651.

Question

Table 24-12. Will's expenditures on food for three consecutive years, along with other values, are presented in the table below. 
-Refer to Table 24-12. Suppose the consumer price index is 15.5 percent higher in 2011 than in 2009. Then Will's food expenditures for 2010 in 2011 dollars amount to
A)$6,352. 
B)$6,380. 
C)$6,426. 
D)$6,651.

Quizplus · Accepted Answer

The CPI in 2011 is 15.5% higher than in 2009. So, to convert Will's food expenditures for 2010 to 2011 dollars, we need to multiply by 1.155.Will's food expenditures for 2010 = $5,526Will's food expenditures for 2010 in 2011 dollars = $5,526 * 1.155 = $6,380