-The Tables Above Give the Purchases of a Typical Consumer

question 251

Essay

$$\begin{array} { | l | c | c | } \hline { \text { Item } } & \begin{array} { l } \text { Quantity } \\( 2010 )\end{array} & \begin{array} { l } \text { Price } \\( 2010 )\end{array} \\\hline \text { Meals } & 100 & \$ 10.00 \\\hline \text { Parking } & 50 & \$ 100.00 \\\hline\end{array}$$
$$\begin{array} { | l | c | c | } \hline { \text { Item } } & \begin{array} { l } \text { Quantity } \\( 2011 )\end{array} & \begin{array} { l } \text { Price } \\( 2011 )\end{array} \\\hline \text { Meals } & 100 & \$ 12.00 \\\hline \text { Parking } & 50 & \$ 97.50 \\\hline\end{array}$$
-The tables above give the purchases of a typical consumer in a country comprised of one large city. These consumers purchase only restaurant meals and parking. The year 2010 is the reference base period.
a) Find the total cost of the CPI basket for 2010 and 2011.
b) What is the CPI in 2010 and in 2011?
c) What is the inflation rate between 2010 and 2011?

---

Definitions:

Profitability of Assets

Profitability of Assets assesses how effectively a company uses its assets to generate profits, typically measured as a ratio of net income to total assets.

Common Stockholders

Owners of common shares in a corporation, who have voting rights and are entitled to dividends as declared by the company's board of directors.

Earnings Per Share

A financial ratio that indicates the portion of a company's profit allocated to each outstanding share of common stock, measuring its profitability on a per-share basis.

Profitability

The ability of a business to generate earnings compared to its expenses and other relevant costs incurred during a specific period.