Year Resident Tuition Consumer Price Index 1980 $350 92.4 2018 $4,570 245.300 16

Question

Year Resident Tuition Consumer Price Index 1980 $350 92.4 2018 $4,570 245.300 16) What is the cumulative inflation rate between 1980 and 2018? A) 165% C) 1,206% B) 39290 D) none of the above 17) What is the nominal increase in tuition between 1980 and 2018 A) 165% C) none of the above D) 1.206% B) 392% 18) What is the real increase in tuition between 1980 and 2018? A) 39290 C) none of the above D) 165% 18) B) 1,206% 19) What is the real 1980 tuition in 2018 dollars 19) A) S4..570 C) S929 D) none of the above B) S1,863

Explanation / Answer

16. A) Cumulative inflation rate between 1980, and, 2018

rate of change of prices = 100*(245.3 - 92.4) / 92.4 = 165.47

17. c) 1205.71% or 1206 percent

Percentage change in resident tuition between 2018, and, 1980 = 100*(tuition in 2018 - tuition in 1980) /tuition in 1980

[(4570-350)/350]*100 = 1205.71

18.

350 is the value at index 92.4

index value 100 = 378.78

Index value 245.3 = $4570

Real tuition fee in 2018 = 378.78 + (1.453*378.78) = 929.14

Increase from 1980 value of 350 = 929.14 - 350 = 579.14

Percentage change in value = 100*(579.14/350) = 165.46%

d) 165.46%

19. c) $929.16

(Tuition in 1980/ CPI in 1980)* CPI in 2018 = 350/92.4 * 245.3 = 929.16

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