Real personal expenditure on consumption goods and services in 2002 chained dollars was $814.2 billion in 2009 and $841.5 billion in 2010. Personal expenditure on consumption goods and services in current dollars was $898.2 billion in 2009 and $940.6 billion in 2010.
a. Calculate the chained price index for consumption (CPIC) for 2009 and 2010.
b. Calculate the CPIC inflation rate for 2010.
c. Why might the CPIC inflation rate be preferred to the CPI inflation rate?
d. Did real personal expenditure on consumption goods and services increase by more or by less than the increase measured in current dollars? Why?