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Answer :
We find that the 2018 price of the car is $22,645.
The 2018 price of the 1970 car is computed as follows: Step 1: Calculate the inflation rate. Inflation rate = (CPI in 2018 - CPI in 1970) / CPI in 1970 Inflation rate = (251.1 - 38.8) / 38.8 Inflation rate = 5.47 or 547% Step 2: Apply the inflation rate to the 1970 price. 2018 price = 1970 price * (1 + inflation rate) 2018 price = $3,500 * (1 + 5.47) 2018 price = $3,500 * 6.47 2018 price = $22,645. Therefore, the 2018 price of the 1970 car is $22,645.
To calculate the 2018 price of the 1970 car, we first need to determine the inflation rate. The inflation rate is the percentage increase in prices over time. It is calculated by taking the difference between the Consumer Price Index (CPI) in 2018 and the CPI in 1970, dividing it by the CPI in 1970, and then multiplying by 100.
In this case, the CPI in 2018 is 251.1 and the CPI in 1970 is 38.8. Plugging these values into the formula, we find an inflation rate of 547%. Next, we apply the inflation rate to the 1970 price of the car. This is done by multiplying the 1970 price by 1 plus the inflation rate. In this case, the 1970 price is $3,500. After performing the calculation, we find that the 2018 price of the car is $22,645.
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