Problem
The city of King's Landing produces three goods which are included in the fixed basket of the CPI. The prices and quantities are given in the following table:
|
Year
|
Price
|
Quantity
|
|
Fish
|
298 AC
|
$10.50/lb.
|
75,000 lbs.
|
|
299 AC
|
$8.75
|
75,000
|
|
|
|
|
|
Beer
|
298 AC
|
$3.25/pint
|
152,500 pints
|
|
299 AC
|
$5.00
|
152,500
|
|
|
|
|
|
Clothing
|
298 AC
|
$15.50/shirt
|
28,750 shirts
|
|
299 AC
|
$16.10
|
28,750
|
Calculate the CPI for 298 AC and 299 AC using 298 AC as the base period.
What was the inflation rate between 298 AC and 299 AC?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.