Econ-201-Q121:50pm-FA-2017 lomework: Chapter 5 Homework core: 0 of 1 pt TDA: CPI

Question

Econ-201-Q121:50pm-FA-2017 lomework: Chapter 5 Homework core: 0 of 1 pt TDA: CPI Inflation by Category Real-Time Data Analysis Exercise The following table gives the value of selected consumer price index categories from ERED for September, 2013 andSeptomber, 2017 13of13(11 oormplete) Consumer Price Indexes: Selected Categories Food and Month/Yr Beverages Apparel Transportation Medical Care Sep/2013 237483 Sep 2017 250 640 127 290 217.370 428.370 25.508 204 600 476.696 Real-time data provided by Federal Reserve Economic Data (FRED,Federal Reserve Bank of Saint Lous As with all index numbers, the overall CPI and its several categories assign to the arbitrarly selected base year (or period) the numerical valueEnter your response as a whole Enter your answer in the anwer box and then click Check Answer Clear All B0 caps lock shift

Explanation / Answer

The base year is considered to have a value equal to 100. This is because when making the comparison to a particular year we divide the enteries of each year by the base year and mulltiply by 100 to get the values at the new base. This imply for the base year we have index = (CPIbase/CPIbase)*100 = 100

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