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5 April, 01:57

The price of a gallon of gasoline was $0.35 in 1972 when the CPI equaled 0.418. The price of a gallon of gasoline was $2.25 in 2005 when the CPI equaled 1.68. The real price of a gallon of gasoline between 1972 and 2005:

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Answers (1)
  1. 5 April, 03:05
    0
    increased

    Explanation:

    Data provided in the question:

    Price of a gallon of gasoline in 1972 = $0.35

    CPI in 1972 = 0.418

    Price of a gallon of gasoline in 2005 = $2.25

    CPI in 2005 = 1.68

    Now,

    Real cost in 1972 = [ Nominal cost in 1972 ] : [ CPI in 1972 ]

    = $0.35 : 0.418

    = $0.837

    Real cost in 2005 = [ Nominal cost in 2005 ] : [ CPI in 2005 ]

    = $2.25 : 1.68

    = $1.34

    Hence,

    The price of gallon of gasoline increased between 1972 and 2005
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Home » Business » The price of a gallon of gasoline was $0.35 in 1972 when the CPI equaled 0.418. The price of a gallon of gasoline was $2.25 in 2005 when the CPI equaled 1.68. The real price of a gallon of gasoline between 1972 and 2005:
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