Question

What is the expected price of a calculator in the year 2000 if it costs $19.51 in 2015? You can use the chart below for a reference of CPI values. Year CPI 1990 130.7 1995 152.4 2000 172.2 2005 195.3 2010 218.056 2015 237.017​

Answer 1

The Consumer Price Index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services. It is calculated by taking price changes for each item in the predetermined basket of goods and averaging them.

To find the expected price of the calculator in the year 2000, we can use the formula:

Price_in_2000 = Price_in_2015 * (CPI_in_2000 / CPI_in_2015)

Given that the price of the calculator in 2015 is $19.51, the CPI in 2000 is 172.2, and the CPI in 2015 is 237.017, we can substitute these values into the formula:

Price_in_2000 = $19.51 * (172.2 / 237.017)

Therefore, the expected price of the calculator in the year 2000 would be approximately $14.17.