Question

The information in the table identifies a market basket purchased by the average urban consumer, and the prices of the goods in two different years. The base year is 2015. Item Market Basket Price 2015 Price 2016 Movie tickets 4 $10 $13 Bags of 2 $5 $8 popcorn Drinks of soda 4 $4 $6 Calculate the consumer price index for 2016, Enter a number rounded to two decimal places. Next Previous A wx] MacBook 80 DOO * & 7 % 5 0 # 3 9 8 6 4 2 P o Y T U W E R к L G H F S D N M B V с X

Answer 1

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Question:

Answer:

There are three question in the line, will solve these question in the same sequence:

1). Answer:

CPI = (Cost of Market Basket in Given Year/Cost of Market Basket in Base Year) *100

Cost of Market Basket in Base Year = 4*10 + 2*5 + 4*4 = 40 +10 + 16 = 66

Cost of Market Basket in Given Year = 4*13+ 2*8 + 4*6 = 52 + 16 + 24 = 92

CPI for the year 2016 = 92/66 = 1.39 * 100 = 139.39 = 39.39%

2). Answer:

Marginal Cost = Change in total cost/Change in total quantity

15-0/70-50 = 15/20 = $0.75

The marginal cost of hiring the worker for one hour = $0.75

Marginal Benefits = Change in total benefit/change in total quantity

= (88*3 - 70*3)/ 30 - 15 = (264-210)/15 = 54/15 = $3.6

The marginal benefits of hiring the worker for a second hour $3.6

3). Answer:

Rule 70 =

Number of Years to Double= 70/ Annual Rate of Return

= 70/4.59 = 15.25

In 15.25 years GDP per capita will grow from $5000 to $10000 or get double.

So, it will take next 15.25 years to grow from $10000 to $20000

Total time = 15.25 + 15.25 = 30.50 years.

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