-Considering the data from the table shown above, assuming that the market basket cost of light bulbs and volleyballs in the base year was $4500, what would be the price index for the year 2018?
A) 177.78
B) 156.30
C) 100.00
D) 92.70

Question

-Considering the data from the table shown above, assuming that the market basket cost of light bulbs and volleyballs in the base year was $4500, what would be the price index for the year 2018?
A) 177.78 
B) 156.30 
C) 100.00 
D) 92.70

Quizplus · Accepted Answer

The price index is calculated by taking the cost of the market basket in the year of interest (2018) and dividing it by the cost of the same market basket in the base year, then multiplying by 100. Assuming the cost of the market basket in 2018 is higher than in the base year (as indicated by the assumption of a base cost of $4500), and given the options provided, the only logical conclusion without seeing the actual data is that the price index must be over 100, indicating an increase in prices. Among the given options, 177.78 is the only one that suggests an increase, making it the correct choice.

-Considering the Data from the Table Shown Above, Assuming That