Question

The percent change in the Consumer Price Index from May of 2000 to May of 2012 is approximately 34%. If the ConsumerPrice Index May of 2012 is 270, what was the original CPI in May of 2002? Round to the nearest one decimal place.____CPI

Answer 1

Let the the original CPI in May of 2002 be R

The change in CPI in absolute terms between May 2000 and May 2012

= 270 - R

As a percentage, this may be expressed as

(270 - R)/R = 34%

(270 - R)/R = 0.34

multiply both sides by R

270 - R = 0.34R

270 = R + 0.34R

270 = 1.34R

Divide both sides by R

270/1.34 = R

R = 201.49

To one decimal place

R = 201.5