[7] 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 caiculations for 2021 and 2022, and enter the resuits in the following table. Quantity 2020 2021 2022 in Price Cost Price Cost Price Cost Basket (Dollars) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars) Streaming 1 64 64 104 W services Iced coffees 150 2 300 2 2 5= _:::J Textbooks 10 80 800 85 105 [raieaea Notebooks 8 2 16 2 4 = Energy 40 3 120 4 5 e drinks Total cost 1,300 ] Price index 100 Cj 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 byl %) ik 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 alf that apply. O A new, cheaper internet option rolled out services nationwide. O Professors required each student to buy 10 textbooks, regardless of the price, (O As the price of premium streaming services rose, fewer students decided to buy them, opting instead to borrow log-in information from friends and relatives. () Energy drinks became increasingly popular on college campuses between 2020 and 2022 due to significant improvements in flavor, but this quality change is hard to measure