A Consumer Expenditure Survey Reports the Following Information on Entertainment

question 113

Multiple Choice

A consumer expenditure survey reports the following information on entertainment spending: $\begin{array}{c}\quad\quad\quad\quad2005 \quad\quad\quad \quad\quad\quad2006\\\begin{array}{|l|c|c|c|c|}\hline & \text { Price } & \text { Quantity } & \text { Price } & \text { Quantity } \\\hline \text { Movies } & \$ 7 & 5 & \$ 8 & 7 \\\hline \text { Concerts } & \$ 30 & 2 & \$ 35 & 2 \\\hline \text { CDs } & \$ 16 & 7 & \$ 15 & 10 \\\hline\end{array}\end{array}$
Using 2005 as the base year,by how much does a "cost of entertainment" index increase between 2005 and 2006?

• A)3.86%
• B)8.65%
• C)13.43%
• D)29.41%

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Definitions:

December 31

The last day of the year in the Gregorian calendar, commonly associated with the closing of fiscal and calendar year accounts.

Cash Equivalents

Investments of a short duration that are easily turned into fixed cash amounts and carry minimal risk of varying in worth.

Interest Rate Changes

Interest rate changes refer to the fluctuation of the cost of borrowing money or the return on investment, directly affecting economic activities such as loans and savings.

December 31

The last day of the year, commonly used as the end date for annual financial statements and reports.