Ben Thomas Penns 34300 and receives a 6% raise in a year in which inflation was...
Ben Thomas Penns 34300 and receives a 6% raise in a year in which inflation was 2.5% and knowing taxes find the net gain in his purchasing power
Homework Answers
Net gain in purchasing power:
= Gain in real terms/(1+Inflation rate)
= $34,300*6%/(1+2.50%)
= $2,058/1.025
= $2,007.80
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