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A movie ticket cost $0.5 in 1970. The CPI (1970) and the CPI (2011) was 38.8 and 218.8 respectively. How much money would you have needed in 2011 to buy a movie ticket?

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1 Answer

4 votes

Answer:

$2.82

Step-by-step explanation:

The CPI is the measure of the average changes in prices of consumer goods and services. The CPI compares current prices and prices at the base year.

CPI is expressed as a percentage. It represents the cost of goods in a given year divided by the cost of goods in the base year multiplied by 100.

In 1970, the movie price was $0.50, and CPI was 38.8%

in 2011, CPI was 218.8%; the movie price will be?

in 1970: $0.50 =38.8%

in 2011: ? = 218.8%

?= 218.8/38.8 x $0.50

?=5.6392 x 0.50

=$2.81896

=$2.82

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