The consumer price index includes the prices of hundreds of goods purchased by consumers. It is possible to construct many other price indexes.
1) Select ten (or more) different products to put in your basket.
• be specific like unleaded gasoline, Budweiser beer…
2) Select a quantity for each product. This would be your market basket.
• Like 15 gallons gasoline, 12 pack of Budweiser
3) Calculate the actual price for each product.
4) Compute the total cost of your market basket. (Keep track of the date)
5) At the end of the semester, claculate the prices for these same ten (or more) products and recalculate the cost of your market basket.
6) Compute your SPI (Student Price Index) and the rate of inflation between the beginning and the end of the semester.