$1.$ Calculating inflation using a simple price index

Consider an imaginary price index, the Undergraduate Price Index $($UPI$),$ created to represent the annual purchases made by a typical undergradute. The following table contains information on the market basket for the UPI and the price of each good in $2020,2021,$ and $2022.$

The cost of each good in the basket as well as the basket$$s total cost are given for $2020.1.$ Calculating inflation using a simple price index

Consider an imaginary price index, the Undergraduate Price Index $($UPI$),$ created to represent the annual purchases made by a typical undergradute. The following table contains information on the market basket for the UPI and the price of each good in $2020,2021,$ and $2022.$

The cost of each good in the basket as well as the basket's total cost are given for $2020.$

Perform these same calculations for $2021$ and $2022,$ and enter the results in the following table.

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|$c$|$c$|$c$|$c$|$c$|\}$

$\backslash$hline $\backslash$multirow$[$t$]\{2\}\{*\}\{\}$ & $\backslash$multirow$[$b$]\{2\}\{*\}\{$Quantity in Basket$\}$ & $\backslash$multicolumn$\{2\}\{|$c$|\}\{2020\}$ & $\backslash$multicolumn$\{2\}\{|$c$|\}\{2021\}$ & $\backslash$multicolumn$\{2\}\{|$c$|\}\{2022\}\backslash \backslash$

$\backslash$hline & & $\backslash$begin$\{$tabular$\}\{$l$\}$

Price $\backslash \backslash$

$($Dollars$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Cost $\backslash \backslash$

$($Dollars$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Price $\backslash \backslash$

$($Dollars$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Cost $\backslash \backslash$

$($Dollars$)$

$\backslash$end$\{$tabular$\}$ & $\backslash$begin$\{$tabular$\}\{$l$\}$

Price $\backslash \backslash$

$($Dollars$)$

$\backslash$end$\{$tabular$\}$ & Cost $($Dollars$)\backslash \backslash$

$\backslash$hline Streaming services & $1$ & $64$ & $64$ & $104$ & & $134$ & $\backslash \backslash$

$\backslash$hline Iced coffees & $150$ & $2$ & $300$ & $2$ & & $2$ & $\backslash \backslash$

$\backslash$hline Textbooks & $10$ & $80$ & $800$ & $85$ & & $105$ & $\backslash \backslash$

$\backslash$hline Notebooks & $8$ & $2$ & $16$ & $2$ & & $4$ & $\backslash \backslash$

$\backslash$hline Energy drinks & $40$ & $3$ & $120$ & $4$ & & $5$ & $\backslash \backslash$

$\backslash$hline Total cost & & & $1,300$ & & & & $\backslash \backslash$

$\backslash$hline Price index & & & $100$ & & & & $\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$

Suppose this price index uses $2020$ as the base year.

In the last row of the table, calculate and enter the value of the UPI for the remaining years.

Between $2020$ and $2021,$ the UPI increased by $.$ Between $2021$ and $2022,$ the UPI increased by

Which of the following, if true, would illustrate why price indexes such as the UPI might overstate inflation in the cost of going to college? Check all that apply.

Professors required each student to buy eight notebooks, regardless of the price.

A natural dietary supplement is developed that is clinically proven to safely boost memory.

The quality of content provided by streaming services improved dramatically from $2020$ to $2022.$ Many companies invested heavily in the actors cast for their original series, but this quality change is hard to measure.

As the price of textbooks increased, more and more students turned to the used$-$book market or chose not to buy textbooks at all, instead using the copies on reserve in the library.