Question

Suppose the people of canada buy only juice and cloth. the cpi basket contains quantities bought in 2020. the average canadian household spent $500.00 on juice and $200.00 on cloth in 2020 when juice was $4.00 per bottle and cloth was $10.00 per metre. in 2021 the price of juice was $8.00 per bottle and the price of cloth was $12 per metre. What percentage of the household spending was spent on cloth in 2020?

Answer 1

To find the percentage of household spending that was spent on cloth in 2020, we need to calculate the proportion of total spending that was allocated to cloth. The proportion of spending on cloth is approximately 28.57% of the total household spending in 2020.

Step-by-step explanation:

To find the percentage of household spending that was spent on cloth in 2020, we need to calculate the proportion of total spending that was allocated to cloth. First, let's calculate the total spending in 2020:

Total spending = spending on juice + spending on cloth

Total spending = $500.00 + $200.00 = $700.00

Next, let's calculate the proportion of total spending allocated to cloth:

Proportion of spending on cloth = (Spending on cloth / Total spending) * 100%

Proportion of spending on cloth = ($200.00 / $700.00) * 100% = 28.57%

Therefore, approximately 28.57% of the household spending was spent on cloth in 2020.