Let Us Reconsider the Case of Ronald in Problem 4

question 19

Multiple Choice

Let us reconsider the case of Ronald in Problem 4. Let the prices and consumptions in the base year be as in situation D, where p₁ = $3, p₂ = $1, x₁ = 5, and x₂ = 15. If in the current year, the price of good 1 is $1 and the price of good 2 is $1, and his current consumptions of good 1 and good 2 are 25 and 10 respectively, what is the Laspeyres price index of current prices relative to base year prices? (Pick the most nearly correct answer.)

• A) 0.50
• B) 0.25
• C) 1.17
• D) 0.67
• E) 1

---

Definitions:

Caloric Intake

The total number of calories consumed through eating and drinking over a period of time, critical for diet and health management.

Serum Level

The concentration of a specific substance in the liquid part of the blood, after the blood has clotted, used to diagnose or monitor diseases.

Lithium

A chemical element used in the treatment of bipolar disorder and other mental health conditions.

Therapeutic Limits

Boundaries established by healthcare providers to maintain a professional and safe relationship with their patients.