The table below lists the prices from last year and the base year for a college-related basket of goods. Assumethat the typical basket of goods for a college student consists of 200 gallons of gas, 60 pizzas, 45 6-packs, and2 textbooks.Basket of College-Related GoodsBasket of Goods Price Base Year (dollars) Price Last Year (dollars)Gasoline (per gallon) $ 1.70$ 2.20Pizza (per pizza)7.85Beer (per 6-pack)6.884.204.10Textbook (per book)98.00a. Using the values above, what is the rate of inflation between the base year and last year? %b. Assume that rather than buying textbooks for their courses last year, all students decided to buy onlineaccess cards at $100 per textbook. What is the rate of inflation between the base year and last year now? %229.00

Inflation is an economic term that describes the increase in the general price level of goods and…

The table below lists the prices from last year and the base year for a college-related basket of goods. Assum that the typical basket of goods for a college student consists of 200 gallons of gas, 60 pizzas, 45 6-packs, a 2 textbooks. Basket of College-Related Basket of Goods Gasoline (per gallon) Pizza (per pizza) Beer (per 6-pack) Goods Price Base Year (dollars) Price Last Year (dollars) $ 1.70 $ 2.20 7.85 6.88 4.20 4.10 Textbook (per book) 98.00 a. Using the values above, what is the rate of inflation between the base year and last year? % 229.00

The table below lists the prices from last year and the base year for a college-related basket of goods. Assum that the typical basket of goods for a college student consists of 200 gallons of gas, 60 pizzas, 45 6-packs, a 2 textbooks. Basket of College-Related Basket of Goods Gasoline (per gallon) Pizza (per pizza) Beer (per 6-pack) Goods Price Base Year (dollars) Price Last Year (dollars) $ 1.70 $ 2.20 7.85 6.88 4.20 4.10 Textbook (per book) 98.00 a. Using the values above, what is the rate of inflation between the base year and last year? % 229.00

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The table below lists the prices from last year and the base year for a college-related basket of goods. Assume
that the typical basket of goods for a college student consists of 200 gallons of gas, 60 pizzas, 45 6-packs, and
2 textbooks.
Basket of College-Related Goods
Basket of Goods Price Base Year (dollars) Price Last Year (dollars)
Gasoline (per gallon) $ 1.70
$ 2.20
Pizza (per pizza)
7.85
Beer (per 6-pack)
6.88
4.20
4.10
Textbook (per book)
98.00
a. Using the values above, what is the rate of inflation between the base year and last year? %
b. Assume that rather than buying textbooks for their courses last year, all students decided to buy online
access cards at $100 per textbook. What is the rate of inflation between the base year and last year now? %
229.00

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