For the CPI. the value of the index in the base year
A) always equals 100.
B) depends upon price and quantity that are constantly changing.
C) is always greater than 100.
D) depends upon what prices did the year before.

Question

Quizplus · Accepted Answer

The CPI (Consumer Price Index) is calculated by comparing the price of a basket of goods and services in the current year to the price of the same basket in a base year. By definition, the value of the CPI in the base year is always set to 100. This allows for comparisons of price changes over time.