Using arithmetic mean, price index in 1980 = ∑R/N = 870/5 = 174. The preceding table shows that 1970 is the base period and 1980 is the year for which the price index has been constructed on the basis of price relatives. The index of wholesale prices in 1980 comes to 174. This means that the price level rose by 74 per cent in 1980 over 1970. This is the simplest formula for pricing your products: WHOLESALE PRICE = (Labor + Materials) x 2 to 2.5 The x2 to 2.5 takes into account your profit and overhead as well, so you’re covered. If your products are in the luxury or upscale market, you’ll be closer to 2.5. The cost of living was estimated at slightly more than $148,000 per year, while the median income for San Francisco was approximately $108,000 per year. Although a salary of $108,000 is attractive, it doesn't cover the cost of living in the city.