The following table gives information on the Consumer Price Index and the monthl

Question

The following table gives information on the Consumer Price Index and the monthly take-home pay of Charlie Maher, and employee of General Motors in Bowling Green, Kentucky. The data is from 1882-1884 and 2014.

Year

Consumer Price Index

(1882-1884 = 100)

Charlie’s Take-Home Pay

1882-1884

100

600

2014

234.556

2200

What is the purchasing power of the dollar in 2014, based on the period 1982-1984?

$0.426           

$0.234            

$1.07               

$0.3456

e.$0.2727

What is Mr. Maher’s “real” income in 2014?

$600           

$235

c. $2,200         

$871                       

$938

Year

Consumer Price Index

(1882-1884 = 100)

Charlie’s Take-Home Pay

1882-1884

100

600

2014

234.556

2200

Explanation / Answer

1) a

2) e

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