Today the price of a jeep is $25,000. In 1970 the price was $5,000. What is the price relative?

Solution:

The ratio between one amount and the other is called the relative price. The price is expressed 100 times for mathematical reasons.

Price Relative = Price A/Price B × 100

Price of a jeep today Price A = $25,000

Price of a jeep in 1970 Price B = $5,000

Substituting these values

Price Relative = 25000/5000 × 100

So we get,

Price Relative = $ 500

Therefore, the price relative is $ 500.

Today the price of a jeep is $25,000. In 1970 the price was $5,000. What is the price relative?

Summary:

Today the price of a jeep is $25,000. In 1970 the price was $5,000. The price relative is $ 500.