Suppose you want to calculate a consumer price index (CPI) f…
Suppose you want to calculate a consumer price index (CPI) for college students. Let’s keep things simple and assume that a typical student buys seven textbooks, nine pizzas, and twelve six-packs of beer in a year. The table below shows this market basket and the price of each good in 2016 and 2017. For the questions below, assume that 2016 is the base year for the CPI. 2016 2017 Good Quantity Unit price Unit price Textbooks 7 $180.00 $210.00 Pizza 9 12.00 10.00 Beer 12 10.00 12.00 CPI = (current basket price/basket price in base year) x 100 If 2016 is the base year, the price index in 2017 was ______________.