TABLE 16-2 Given Below Are the Prices of a Basket of Four

question 28

Short Answer

TABLE 16-2
Given below are the prices of a basket of four food items from 2006 to 2010.

-Referring to Table 16-2, what is the Laspeyres price index for the basket of four food items in 2009 that consisted of 50 bushels of wheat, 30 bushels of corn, 40 bushels of soybeans and 80 hundredweight of milk in 2006 using 2006 as the base year?

---

Definitions:

Rights Offering

A method by which companies raise capital, giving existing shareholders the right to buy additional shares at a discounted price.

Common Stock

represents units of ownership in a public corporation, entitling shareholders to vote on corporate matters and receive dividends.

Outstanding Shares

The total shares of stock that are currently owned by all shareholders, including share blocks held by institutional investors and restricted shares owned by company insiders.

Rights Offering

A corporate action in which a company offers existing shareholders the opportunity to buy additional shares directly from the company at a discounted price before the public.