Question

Us national health expenditure was $7,026 per person in 2006 and $4,790nin 2000. the consumer price index had a value of 201.6 in 2006 and value of 172.2 in 2000. adjusted for inflation, how much was spending?

Answer 1

To calculate the adjusted spending, divide the spending in each year by their respective CPI values and multiply by the base CPI. Adjusted spending in 2006 was approximately $3,480.56 and in 2000 was approximately $2,780.35.

Step-by-step explanation:

To calculate the adjusted spending, we need to divide the spending in 2006 and 2000 by the respective Consumer Price Index (CPI) values for those years and then multiply by the CPI value in the base year, which is usually taken as 100.

Adjusted Spending (2006) = (Spending in 2006 / CPI in 2006) * Base CPI

Adjusted Spending (2000) = (Spending in 2000 / CPI in 2000) * Base CPI

Substituting the given values:

Adjusted Spending (2006) = ($7,026 / 201.6) * 100 = $3,480.56

Adjusted Spending (2000) = ($4,790 / 172.2) * 100 = $2,780.35

Therefore, the adjusted spending in 2006 was approximately $3,480.56 and the adjusted spending in 2000 was approximately $2,780.35.