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Over the past 15 years data has been recorded on prices and wages. Index numbers for this data are shown in the table below.
Both index series have been rebased during this time period.
a. Create a single index series for prices with Year 0 as the base year.
b. Create a single index series for wages with Year 0 as the base year.
c. Construct a graph showing these two index series.
d. Find the year by year percentage change in prices and the year by year percentage change in wages and graph your results.
e. Comment on the implications of your results for the standard of living within the country. What reservations might you have about using this data to infer conclusions about the standard of living? What extra information would you require to make more positive statements about the standard of living?
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