-Refer to the above table. You are given information on Collin's consumption for 2007 and 2017. Using 2007 as the base year compute the price index for 2017. The index equals
A) 0.75.
B) 73.007.
C) 87.50.
D) 136.842.

Question

-Refer to the above table. You are given information on Collin's consumption for 2007 and 2017. Using 2007 as the base year compute the price index for 2017. The index equals
A) 0.75. 
B) 73.007. 
C) 87.50. 
D) 136.842.

Quizplus · Accepted Answer

The price index is calculated by taking the cost of the basket of goods in the current year (2017) and dividing it by the cost of the basket in the base year (2007), then multiplying by 100. If the cost in 2017 is higher than in 2007, the price index will be greater than 100, indicating inflation. Without the specific numbers from the table, we can't calculate the exact index, but an index of 136.842 suggests that prices have increased by approximately 36.842% from 2007 to 2017, which is a plausible scenario for a 10-year period.

-Refer to the Above Table