- 2 All Consumer Goods And Services Are Placed In One Of Three Categories Shown In The Table 1 Below Item Current Price 1 (49.81 KiB) Viewed 39 times
2. All consumer goods and services are placed in one of three categories shown in the table 1 below: Item Current Price
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2. All consumer goods and services are placed in one of three categories shown in the table 1 below: Item Current Price
2. All consumer goods and services are placed in one of three categories shown in the table 1 below: Item Current Price Index (CPI) (Base year = 100) Food 110 Clothing 120 Housing 130 Calculate a) The simple Consumer Price Index (CPI). (2 marks) b) If the weights for food, clothing and housing were given as 8,4 and 3 respectively, calculate the weighted Consumer Price Index (CPI). (2 marks) c) What is the advantage of weighted consumer price index over simple consumer price index? (2 marks) d) "The price index is said to be 120". What does this statement mean? (2 marks) e) Explain briefly TWO (2) problems in calculating Consumer Price Index (CPI) (2marks) (Total : 10 marks)
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