-The Tables Above Give the Purchases of an Average Consumer

question 352

Essay

$$\begin{array} { | l | c | c | } \hline { \text { Item } } & \begin{array} { c } \text { Quantity } \\( 2012 )\end{array} & \begin{array} { c } \text { Price } \\( 2012 )\end{array} \\\hline \text { Shampoo } & 25 & \$ 2.35 \\\hline \text { Pizza } & 15 & \$ 7.50 \\\hline\end{array}$$
$$\begin{array} { | l | c | c | } \hline { \text { Item } } & \begin{array} { c } \text { Quantity } \\( 2012 )\end{array} & \begin{array} { c } \text { Price } \\( 2013 )\end{array} \\\hline \text { Shampoo } & 25 & \$ 2.50 \\\hline \text { Pizza } & 15 & \$ 7.75 \\\hline\end{array}$$
-The tables above give the purchases of an average consumer in a small economy.(These consumers purchase only shampoo and pizza.) Suppose 2012 is the reference base period.
a) What is the cost of the CPI basket in 2012 and 2013?
b) What is the CPI in 2012 and in 2013?
c) What is the inflation rate between 2012 and 2013?

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Definitions:

Ethnic Groups

Communities or populations sharing common cultural traits, geographical origins, linguistic backgrounds, or ancestry.

Population Growth

An increase in the number of people that reside in a country, region, or city, which can impact various aspects of society including demand for products and services.

Government Subsidies

Financial assistance provided by the government to organizations, individuals, or industries to support activities deemed beneficial for the public good.

Currency Fluctuation

The variation in the value of one currency relative to another in the global market.