Week 1 Item Coffee DVDs Gasoline Week 2 Item Coffee DVDs Gas

Week 1 Item Coffee DVDs Gasoline Week 2 Item Coffee DVDs Gasoline Concert The table shows the quantities of the goods Suzie bought and the prices she paid during two consecutive weeks. Quantity 13 cups Price $2.75 a cup $30.00 each Suzle\'s CPI market basket contains the goods she bought in Week 1 15 gallons$250 a galon Quantity 13 cups Price 2.75 a cup $15.00 each $3.00 a gallon 595 each 5 galions 1 bicket The value of Suzie\'s CPI in Weok 2 is The cost of Suzie\'s CPI market basket in Week 1 is s>» Answer to 2 decimal places The cost of her CPI market basket in Week 2 is Answer to 1 decimal place Suzie\'s inflation rate in Week 2 ispercent. >Answer to 1 decimal place o> If your answer is negative, Include a minus sign If your answer is Answer to 2 decimal places Gasoline is percent of the CPI market basket not include a plus sign Enter your answer in each of the answer boxes.

Solution

1.

Cost of Suzie’s CPI market basket in week 1 = 13*2.75 + 1*30 + 15*2.5 = $103.25

2.

Cost of Suzie’s CPI market basket in week 2 = 13*2.75 + 1*15 + 15*3 = $95.75

3.

% of gasoline in market basket of week 2 = 15*3/95.75 = 47 %

4.

Value of Suzie’s CPI in week 2 = (95.75/103.25)*100 = 92.7

5.

Inflation rate in week 2 = (95.75 - 103.25)/ 103.25

Inflation rate in week 2 = -7.3%