The median sales prices for new single-family houses for the years 2004-2007 are as follows (Census Bureau website, March 19, 2009).
Year Price ($1000s)
2004 ...........221.0
2005 ...........240.9
2006 ...........246.5
2007 ...........247.9
a. Use 2004 as the base year and develop a price index for new single-family homes over this four-year period.
b. Use 2005 as the base year and develop a price index for new single-family homes over this four-year period.