Calculating the medical care CPl Create a bundle of goods and services Bundle should approximate typical consumption of goods and services demanded Compare the total of cost of this bundle this year to the total cost last year Bhattacharya,Hyde and Tu-HealthEconomics
Bhattacharya, Hyde and Tu – Health Economics Calculating the medical care CPI Create a bundle of goods and services Bundle should approximate typical consumption of goods and services demanded Compare the total of cost of this bundle this year to the total cost last year
Calculating the medical care CPl Suppose for simplicity that there are only two goods in the bundle,A and B. (qo,qoB)-quantity of goods A and B in the bundle (PoA,PoB)-yesterday's prices of A and B (p,,p,B)-today's new prices for A and B Laspeyres index IcP: piqo p5qo p哈6+696 Bhattacharya,Hyde and Tu-HealthEconomics
Bhattacharya, Hyde and Tu – Health Economics Calculating the medical care CPI Suppose for simplicity that there are only two goods in the bundle, A and B. (q0 A, q0 B) – quantity of goods A and B in the bundle (p0 A, p0 B) – yesterday’s prices of A and B (p1 A, p1 B) – today’s new prices for A and B Laspeyres index ICPI: