The Cheesecake Factory, Inc., is a popular restaurant chain in the U.S. Although it started as a small restaurant in 1978, it currently has over 140 branches all over the country. The restaurants are characterized by extensive menus, custom decor, and large portions of food. Jeff Watson works as the Kitchen Manager in one of their regional branches. He is responsible for managing the operations as well as food and labor costs. He constantly monitors market conditions and, in his annual reports, analyzes the changing retail cost of the ingredients used in cooking. In his current report, he decides to analyze meat prices. He collects data on monthly average retail prices of three varieties of ground beef. This information is important, as the restaurant purchases about 1,400 pounds of regular, 800 pounds of ground chuck, and 500 pounds of lean ground beef each month. A portion of the data is shown below; the complete data set can be found on the text website, labeled Ground Beef.
2009 Monthly Retail Cost of Grounded Beef (in $ per pound)
|
Month
|
Regular Beef
|
Ground Chuck
|
Lean Ground Beef
|
|
January
|
2.357
|
2.961
|
3.426
|
|
February
|
2.436
|
3.019
|
3.440
|
|
....
|
....
|
....
|
....
|
|
December
|
2.186
|
2.828
|
3.391
|
In a report, use the sample information to:
1. Compute and interpret simple indices for each variety of meat, using January 2009 as the base period.
2. Compute and interpret the weighted aggregate price index, using January 2009 as the base period.
3. Compare the above indices.