3. In 1986, the CPI stood at 109.6 while in 2016 it stood at 240.0. In 1986, a new Toyota Corolla LE had a list price of $8,278, while in 2016 a new Toyota Corolla LE had a list price of $19,835. A. In real terms, which model year – 1986 or 2016 – cost more? B. In what way does using the CPI to compare the cost of both Toyota Corolla LEs fall short in providing an accurate comparison?

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
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Chapter1: Making Economics Decisions
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3. In 1986, the CPI stood at 109.6 while in 2016 it stood at 240.0. In 1986, a new Toyota Corolla LE had
a list price of $8,278, while in 2016 a new Toyota Corolla LE had a list price of $19,835.
A. In real terms, which model year – 1986 or 2016 – cost more?
B. In what way does using the CPI to compare the cost of both Toyota Corolla LEs fall short in
providing an accurate comparison?
Transcribed Image Text:3. In 1986, the CPI stood at 109.6 while in 2016 it stood at 240.0. In 1986, a new Toyota Corolla LE had a list price of $8,278, while in 2016 a new Toyota Corolla LE had a list price of $19,835. A. In real terms, which model year – 1986 or 2016 – cost more? B. In what way does using the CPI to compare the cost of both Toyota Corolla LEs fall short in providing an accurate comparison?
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