Problema Solution
A man earned $80,000 when the Consumer Price Index was 200. What were his earnings in terms of $2,000 if the base period was 2000?
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Solution: Computation of the Earning value
Consumer Price Index = (Current value/Base year value) * 100
where as
CPI = 200,
Current value = 80000
200 = (80000/Base year value) * 100
Base year value = (80000/200) * 100 = 40000
His earnings with base year 2000 were $40,000.