type the correct answer in the box. round your answer to the nearest hundredth, if necessary. a basket of…

type the correct answer in the box. round your answer to the nearest hundredth, if necessary. a basket of goods costs $85 in year 1. if the same basket costs $90 in year 2, what is the cpi for year 2? the cpi for year 2 is

type the correct answer in the box. round your answer to the nearest hundredth, if necessary. a basket of goods costs $85 in year 1. if the same basket costs $90 in year 2, what is the cpi for year 2? the cpi for year 2 is

Answer

Explanation:

Step1: Recall CPI formula

The formula for the Consumer - Price Index (CPI) is $CPI=\frac{\text{Cost of basket in current year}}{\text{Cost of basket in base year}}\times100$.

Step2: Identify values

The cost of the basket in the base year (year 1) is $85$, and the cost of the basket in the current year (year 2) is $90$.

Step3: Calculate CPI

Substitute the values into the formula: $CPI=\frac{90}{85}\times100=\frac{9000}{85}\approx105.88$.

Answer:

$105.88$