Here is the problem: Bryce Harper’s salary a year ago was $45,000. If inflation during the year was 3%, how much of a decline in his purchasing power has occurred? Also, what would be his purchasing power if deflation of 1 % occurred?
Bryce Harper’s salary a year ago was $45,000. If inflation during the year was 3%, how much of a decline in his purchasing power has occurred? Also, what would be his purchasing power if deflation of 1 % occurred?
Homework Answers
| Statement showing Computations | |
| Particulars | Amount |
| Year ago salary | 45,000.00 |
| Inflation | 3% |
| New value of salary = 45000/1.03 | 43,689.32 |
| decline in his purchasing power= 45000 - 43,689.32 | 1,310.68 |
| b) | |
| Year ago salary | 45,000.00 |
| Deflation | 1% |
| New purchasing power | 45,454.55 |
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Here is the problem: Bryce Harper’s salary a year ago was $45,000. If inflation during the year was 3%, how much of a decline in his purchasing power has occurred? Also, what would be his purchasing power if deflation of 1 % occurred?
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