Assume that prices for the items below increased at the aver

Assume that prices for the items below increased at the average annual rates shown in the table. Use the inflation proportion to find the missing price in the last column of the chart. The missing price in 2009 is $. (Round up to the nearest dollar.)

Solution

The CPI-U in 200 was 172.2 and increased to 214.1 in 2009. Hence, in 2009, the price of an evening dress, purchased for $ 174 in 2000 will be $ [(214.1)/(172.2]*174 = $216.34 ( on rounding off to the nearest cent). The missing price in 2009 is $ 216.34