Fresh fruit prices and quantity data for the years 1988 to 2001 follow (Statistical Abstract of the United States, 2002). Quantity data reflect per capita consumption in pounds and prices are per pound.
Fruit 1988 per Capita Consumption (pounds) 1988 Price ($/pound) 2001 Price ($/pound)
Bananas 24.3 0.41 0.51
Apples 19.9 0.71 0.87
Oranges 13.9 0.56 0.71
Pears 3.2 0.64 0.98
a. Compute a price relative to each product
b. Compute a weighted aggregate price index for fruit products. Comment on the change in fruit prices over the 13-year period
The following posting helps compute a price relative to products and a weighted aggregate price index for fruit products.