PART 2 CASE STUDY As an intem in the Fulton County Economic Development Office, you have been asked to develop a special-purpose index for your county. Three economic series seem to hold promise as...

Extracted text: PART 2 CASE STUDY As an intem in the Fulton County Economic Development Office, you have been asked to develop a special-purpose index for your county. Three economic series seem to hold promise as the basis of an index. These data are the price of cotton (per pound), the number of new automobiles sold in the county, and the rate of money turnover (published by the local bank). After discussing the project with your supervisor and the director, you decide that money turnover should have a weight of 60, the number of new automobiles sold a weight of 30, and the cotton price .10. The base period is 1999. Year Cotton Price Automobiles Sold Money Turnover 1999 2004 2009 $0.20 0.25 0.50 1.000 1,200 900 80 75 (a) Construct the index for 2004 and 2009. (b) Interpret the index for 2004 and 2009.


Extracted text: 3. Suppose the Consumer Price Index for the latest month is 195.4 (1982-84 100). What is the purchasing power of the dollar? Interpret.