Suppose You Know the Value of the Consumer Price Index

question 137

Multiple Choice

Suppose you know the value of the consumer price index CPI) in year 1 as well as the inflation rate in year 2. Which of the following equations is valid for the CPI in year 2?

• A) CPI in year 2 =
• B) CPI in year 2 =
• C) CPI in year 2 =
• D) CPI in year 2 =

---

Definitions:

Schedule C

A tax form used by sole proprietors to report profits or losses from a business.

Sole Proprietor

An individual who owns and operates a business alone, bearing sole responsibility for its debts and liabilities.

Education Expenses

Costs associated with schooling or training, including tuition, books, and supplies, that may be eligible for tax deductions or credits.

Law School

An educational institution specializing in the study of law, preparing students to practice as attorneys.