This preview shows page 1. Sign up to view the full content.
Unformatted text preview: .5 ± .5 percent. c. Do the Laspeyres price indexes you obtained imply the same percentage increases in Arnold's cost of living
Prices change by different amounts in the same direction over time.
rev is ed jrl 08082011 Explanation: A Laspeyres price index is a fixedweight index that is based on the consumption bundle actually purchased
in the base period. It tells us whether the cost of the baseperiod consumption bundle has risen or fallen and
by how much.
Expenditures in June at June's prices are: (1.00)5 + (1.20)20...
View Full Document
This note was uploaded on 01/22/2014 for the course ECO 3352 taught by Professor Ax during the Fall '13 term at Troy.
- Fall '13