Answer :
Final answer:
To calculate the cost of rice in 2022 with a wholesale price index of 130 compared to 2020, you increase the 2020 cost by 30%. The price per kilogram rises from $12 in 2020 to $15.60 in 2022.
Explanation:
To calculate the cost of rice in 2022 using the wholesale price index (WPI) (also known as price relative), you first need to understand what a price index indicates.
A price index of 130 signifies that the price has increased by 30% from the base year, which in this case is 2020. The cost of rice per kilogram in 2020 was $12. To find the cost in 2022, you need to increase this amount by 30%.
Cost Calculation:
First, calculate the 30% increment:
30% of $12 is $3.60.
Next, add this increment to the original price to get the price in 2022:
$12 + $3.60 = $15.60.
Therefore, the cost of rice per kilogram in 2022 is $15.60.
