Presentation on theme: "In 1950 the median family income was $3,319, while the average Major League baseball player salary was $13,228. In 1998 the median household income was."— Presentation transcript:
In 1950 the median family income was $3,319, while the average Major League baseball player salary was $13,228. In 1998 the median household income was $38,885, while the average Major League baseball player income was $1.4 million. a. Using the CPI.xls, convert each of the 1950 incomes to constant 1998 dollars and compare the salaries of baseball players and the average household to their actual 1998 values. Put the constant dollar values in your word document. Were you better off earning the median household income in 1950 or 1998? Were you better off being a Major League Baseball player in 1950 or 1998?
1950 Baseball in 1998 dollars 1950 Household in 1998 dollars 89,467.3922,448.01
and compare each constant dollar salary to their actual 1998 values. 1998 Actual baseball salary 1998 actual household salary 1,400,000.0038,885.00 1950 Baseball in 1998 dollars 1950 Household in 1998 dollars 89,467.3922,448.01
b. Have baseball player salaries risen faster than the salaries of the average worker? To answer this question answer the following question, what percent are the actual incomes in 1998 greater than their respective constant dollar values of the 1950 incomes?
2. Open the file DePaul_Tuition.xls. This file contains the DePaul tuition from 1970 to 2009. a. Calculate the tuition in constant 2009 dollars. Then make an XY scatter graph of DePaul tuition in constant dollars and paste it into your document. DePaul_Tuition.xls
What does the graph of DePaul tuition in constant 2008 dollars tell you about tuition increases over the years? Is DePaul tuition growing faster, slower, or at the same rate as inflation?
3. The annual inflation rate is defined as the percentage change in the annual CPI from the previous year to the current year. For example, the CPI in 1998 was 163.0 while the CPI in 1999 was 166.6. The inflation rate for 1999 was therefore (166.6-163.0)/163.0 or 2.2%. a. Open the file CPI.xls, which contains the annual CPI from 1912 to 2009. Add a new column to the table that contains the inflation rate for each year. Paste the resulting table for the years 1970-2009 into your Word document. Please do not paste the entire table from 1912-2009 into the document; we want to focus on the years 1970-2009. CPI.xls