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Suppose a basket of goods and services has been selected to calculate the CPI and 2014 has been selected as the base year. In 2012, the basket's cost was $50; in 2014, the basket's cost was $52; and in 2016, the basket's cost was $58. The value of the CPI in 2016 was

Respuesta :

Answer:

$111.53

Explanation:

CPI is a statistic applied to measure the average cost of a basket of usually-used goods and services in a period relative to some base period.

Consumer Price Index (CPI) = [tex]\frac{Current Period Price of the Basket}{Base Period Price of the Basket} \times100[/tex]

                                               = [tex]\frac{58}{52} \times100 = 111.53[/tex]

Therefore, The value of the CPI in 2016 was $111.53 taking 2014 as base year.