Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's annual purchases. Suppose the following table shows information on the market basket for the CSPI and the prices of each of the goods in 2018, 2019, and 2020. The expenditure on each item in the market basket and the total dollar expenditure on market basket are shown for 2018. Perform these same calculations for 2019 and 2020, and enter the results in the following table. Notebooks Calculators Large coffees Energy drinks Textbooks Total cost Price index Quantity in Market Basket 10 1 150 10 A Suppose the base year for this price index is 2018. Between 2018 and 2019, the CSPI increased by Price (Dollars) 5 100 1 2 100 2018 Expenditure (Dollars) 50 100 150 100 1,000 1,400 100 Price Expenditure (Dollars) (Dollars) 7 110 1 3 2019 120 In the last row of the table, calculate and enter the value of the CSPI for the remaining years. % Between 2019 and 2020, the CSPI increased by Price Expenditure (Dollars) (Dollars) 11 140 1 4 2020 150

Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's annual purchases. Suppose the following table shows information on the market basket for the CSPI and the prices of each of the goods in 2018, 2019, and 2020. The expenditure on each item in the market basket and the total dollar expenditure on market basket are shown for 2018. Perform these same calculations for 2019 and 2020, and enter the results in the following table. Notebooks Calculators Large coffees Energy drinks Textbooks Total cost Price index Quantity in Market Basket 10 1 150 10 A Suppose the base year for this price index is 2018. Between 2018 and 2019, the CSPI increased by Price (Dollars) 5 100 1 2 100 2018 Expenditure (Dollars) 50 100 150 100 1,000 1,400 100 Price Expenditure (Dollars) (Dollars) 7 110 1 3 2019 120 In the last row of the table, calculate and enter the value of the CSPI for the remaining years. % Between 2019 and 2020, the CSPI increased by Price Expenditure (Dollars) (Dollars) 11 140 1 4 2020 150

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The table below shows the total expenditure on a basket of goods and services. Use this information to calculate index numbers for the cost of a basket of goods and services in each period. Assume Period 1 is the base year. Round to one decimal place. Provide your answer below: Period 1 Period 2 Period 3 Period 4 Total Expenditure $1,100 $1,350 $1,400 $1,450 Period 1 Period 2-Period 3 = Period 4 = | Index Number
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P1
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