Calculate how these famous athletes from different time periods rank in salary by converting each to (our CPI in 2023 is 304). Athlete's nominal income 1980 82.4 Sugar Ray Leonard $18,000,000 (boxing) Year CPI 1931 2015 15.2 237.0 Babe Ruth $80,000 (baseball) Lionel Messi $73,800,000 (beautiful game) Each athlete's real income (in 2023 S) Rank of earnings in today's $
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- 3. The classical dichotomy and the neutrality of money The classical dichotomy is the separation of real and nominal variables. The following questions test your understanding of this distinction. Yesmina divides all of her income between spending on puzzle books and lattes. In 2015, she earned an hourly wage of $28.00, the price of a puzzle book was $7.00, and the price of a latte was $4.00. Which of the following give the real value of a variable? Check all that apply. The price of a puzzle book is 1.75 lattes in 2015. The price of a puzzle book is $7.00 in 2015. Yesmina's wage is $28.00 per hour in 2015. Which of the following give the nominal value of a variable? Check all that apply. The price of a latte is $4.00 in 2015. The price of a latte is 0.57 puzzle books in 2015. Yesmina's wage is 4 puzzle books per hour in 2015. Suppose that the Fed sharply increases the money supply between 2015 and 2020. In 2020, Yesmina's wage has risen to $56.00 per hour. The price of a puzzle book…To convert the original earnings of Nicklaus, Trevino, and Stadler, use the formula for converting dollar figures from an earlier era into year 2017 U.S. dollars. Using those figures, fill in the following table, making sure to round your responses to the nearest U.S. dollar. Year Golfer Nominal Winnings U.S. CPI Winnings in 2017 Dollars (Dollars) (1983 = 100) 1965 Jack Nicklaus 140,752 31.5 1970 Lee Trevino 157,037 38.8 1982 Craig Stadler 446,462 96.5 2017 Justin Thomas 9,921,560 245.1 9,921,560 True or False: According to the previous table, the golfer with the highest PGA winnings in nominal dollars is the same as the golfer with the highest PGA winnings after adjusting for inflation.1. Calculate Real wage and comment who has the higher real wage salary Salary Year Mariam Jude 7500 8000 CPI 95 107 1998 2008 Real wage salary
- The following graph shows the approximate value of the United States Consumer Price Index (CPI) from December 2006 through July 2007. I(t) CPI Dec 2006–July 2007 209 208 207 206 205 204 203 202 201 1 3 4 5 Dec-06 July-07 O The approximating curve shown on the figure is given by I(t) = -0.04t3 + 0.4t2 + 0.1t + 202 (0 sts 7), where t is time in months since the start of December 2006. I'(t) (a) Use the model to estimate the monthly inflation rate in June 2007 (t = 6). Recall that the inflation rate is I(t) (Round your answer to three decimal places.) (b) Was inflation slowing or speeding up in June 2007? O slowing down O speeding up (c) When was inflation speeding up? When was inflation slowing? Inflation was speeding up prior to one third of the way through ---Select--- 2007 and slowing down after that.Consider a fictional price index, the College Student Price Index (CSPI), based on a typical college student's annual purchases. Suppose the following table shows information on the market basket for the CSPI and the prices of each of the goods in 2017, 2018, and 2019. The cost of each item in the basket and the total cost of the basket are shown for 2017. Perform these same calculations for 2018 and 2019, and enter the results in the following table. 2017 2018 2019 Price Cost Price Cost Price Cost Quantity in Basket (Dollars) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars) Notebooks 10 3 30 3 4. Calculators 1 75 75 80 104 Large coffees 300 2. 600 2. 2 Energy drinks 75 150 4 Textbooks 8 90 720 110 120 Total cost 1,575 Price index 100 Suppose the base year for this price index is 2017, In the last row of the table, calculate and enter the value of the CSPI for the remaining years. Between 2017 and 2018, the CSPI increased by F %. Between 2018 and 2019, the CSPI increased by Which of…In 1984 Michael Jordan got a contract with Nike that was worth $500,000 a year, for the next 5 years (1984-1988, inclusive). How much the contract would worth, year-by-year, if we express it in 2018 dollars? Use the following data for this calculation: Year 1984 1985 1986 1987 1988 2018 CPI 103.9 107.6 109.6 113.6 118.3 251.631
- The rent for tenants in a building in 1940 was $30 per month. The landlord changes the rent based on the CPI-U. Use the CPI-U chart below to calculate the current rent in 2005. Round to the nearest dollar. Year CPI-U 1940 14.0 1949 23.8 1983 99.6 2000 172.2 2005 195.3 2009 214.5 2014 236.0 2017 245.1 2019 255.7 2020 258.8 $ (b) Show calculations and explain your reasoning.The table below lists hypothetical CPI and wage values for the United States from different decades. a. Complete the table by computing the real income for each year shown in the table. Instructions: Round your answers to two decimal places. Nominal and Real Income Year 1967 1977 1987 1997 2007 2013 Average Nominal Wage (dollars) $6,825 13,203 25, 232 35,855 48,321 50,667 CPI 32.2 58.6 110.4 155.3 200 226.6 Average Real Wage (dollars) $ Instructions: Enter the year using all four numbers (yyyy). b. Of the years listed above, the paycheck of the average worker was highest in [ c. Of the years listed above, the purchasing power of the average worker was highest inTrish earned a salary of $60,000 in 2002 and $80,000 in 2006. The consumer price index was 177 in 2002 and 221.25 in 2006. Trish's 2002 salary in 2006 dollars is $75,000; thus, Trish's purchasing power increased between 2002 and 2006. O $75,000; thus, Trish's purchasing power decreased between 2002 and 2006. $85,000; thus, Trish's purchasing power increased between 2002 and 2006. $85,000; thus, Trish's purchasing power decreased between 2002 and 2006.
- Michael Jordan Earned $30,100,000 playing for the Chicago Bulls in 1997. In 1997 the CPI was equal to 1.60. In 2020 LeBron James earned $37,400,000 playing for the Los Angeles Lakers. The CPI in 2020 is equal to 2.58. Calculate the real wage for Micheal Jordan in 1997 and Lebron James in 2020. Please enter your answers as numeric answers rounded to the nearest dollar with no decimals (ie. 15,553,342 or $10,432,675 not $15,553,341.73 or $10,432,675.2). Because these will be large numbers it is a good idea to use commas to separate millions, thousands, and hundreds. What was the real wage for Michael Jordan in 1997? What is the real wage for LeBron James in 2020?Consider the simple economy that produces only three products. Use the information in the following table to calculate the (annual rate of inflation for 2020 as measured by the consumer price index (CPI). BASE YEAR (2010) 2019 2020 Price Price $10.00 2.00 Price $11.00 $16.20 240 2.45 15.00 15.00 14:00 Product Haircuts Hamburgers Movies Quantity 3 8 7 Using the information in the table, the CPI for 2019, with 2010 as the base year, is (Enter your response rounded to one decimal place)The island nation of Coronia subsists entirely on pancakes and syrup. That is, they produce and consume only pancakes and syrup in the following amounts: Pancake Mix (cases) Maple Syrup (gallons) Quantity Price Quantity Price 2019 16 5 8 30 2020 48 6 10 50 (a) Using a method like the CPI, compute the CPI in 2019 and 2020 and percentage change in the overall price level from 2019 to 2020 (inflation rate). Use 2019 as the base year and fix the market basket at 4 pancakes and 2 syrups. (b) Using a method like the GDP deflator, compute the GDP deflator in 2019 and 2020 and percentage change in the overall price level from 2019 to 2020 (inflation rate). Use 2019 as the base year. (c) Is there a difference in the inflation rate using the two methods? Explain why or why not.
