ECONOMICS
GDP
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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146.9
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146.4
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146.5
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148.4
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Detailed explanation-1: -To find the CPI in any year, divide the cost of the market basket in year t by the cost of the same market basket in the base year. The CPI in 1984 = $75/$75 x 100 = 100 The CPI is just an index value and it is indexed to 100 in the base year, in this case 1984.
Detailed explanation-2: -The percentage change can be calculated by dividing the change in index points by the earlier time period price index multiplied by 100. Note that the Change in index points and the Percentage change are different measures of change and are usually different.
Detailed explanation-3: -The formula below calculates the real value of past dollars in more recent dollars: Past dollars in terms of recent dollars = Dollar amount × Ending-period CPI ÷ Beginning-period CPI.
Detailed explanation-4: -The formula for inflation adjustment As we have seen, you can adjust for inflation by dividing the data by an appropriate Consumer Price Index and multiplying the result by 100.
