Let Us Reconsider the Case of Ronald in Problem 4

question 21

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 $3, and his current consumptions of good 1 and good 2 are 25 and 20 respectively, what is the Laspeyres price index of current prices relative to base year prices? (Pick the most nearly correct answer.)

• A)1
• B)1.67
• C)0.75
• D)2.83
• E)2.50

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Definitions:

Company Loyalty

The dedication and commitment of an employee to their employer, often demonstrated through long-term service and support for the company's goals.

Hand-deliver

The personal delivery of a document or parcel directly to the recipient by the sender.

St. John's

A city in Newfoundland and Labrador, Canada, known for its rich history, vibrant cultural life, and as the easternmost city in North America.

Vancouver

A major city in western Canada, located in the province of British Columbia, known for its scenic beauty and as a hub for cultural diversity and economic activity.