Calculating Relative Price of Gasoline in Terms of Milk
What was the relative price of a gallon of gasoline in terms of milk in April 2014?
The relative price of a gallon of gasoline in terms of milk in April 2014 was 1.62 cartons of milk. The correct option is C.
Calculating Relative Price
The relative price of a gallon of gasoline in terms of milk is calculated by dividing the price of a gallon of gasoline by the price of a carton of milk.
Relative Price Formula:
Relative Price = Price of Gasoline / Price of Milk
Calculations:
Price of Gasoline = $3.63 Price of Milk = $2.01 Relative Price = $3.63 / $2.01 Relative Price ≈ 1.805 This means that one gallon of gasoline is approximately 1.805 times more expensive than one carton of milk. Among the provided options, "c) 1.62 cartons of milk" is the closest to the calculated relative price. It may not be an exact match, but it is the option that aligns most closely with the calculated value. Option "a) 1.81 cartons of milk" is incorrect as it represents the inverse of the calculated relative price, implying that one gallon of gasoline is cheaper than one carton of milk, which is not the case. Option "b) 0.55 cartons of milk" is also incorrect, suggesting that one gallon of gasoline is less expensive than one carton of milk, which contradicts the given prices. Option "d) $1.81" is not the correct relative price as it is in dollars, rather than in terms of cartons of milk, which is the appropriate unit of comparison for relative prices in this scenario.