Question

In: Finance

When Kevin started working 29 years ago, his salary was $69,920.His current salary is$165,074....

When Kevin started working 29 years ago, his salary was $69,920. His current salary is

$165,074. When Kevin started working, the price level was 120, while the current price level is

156. How much has Kevin’s salary increased in real terms over the 29 years?

State your answer to two decimal places (e.g., 3;28).

Solutions

Expert Solution

Salary of Kevin when he started working = $69,920

- When Kevin started working, the price level was 120, while the current price level is 156.

Salary of kevin now as per the price level = Initial salary*(Price level now/Price level hwne started working)

Salary of kevin now as per the price level = $69,920*(156/120)

Salary of kevin now as per the price level = $90,896

- Actual Salary of kevin Now = $165,074

Increase in Kevin's salary in real terms = Actual Salary of kevin Now - Salary of kevin now as per the price level

Increase in Kevin's salary in real terms = $165,074 - $90,896

Increase in Kevin's salary in real terms = $74,178.00

jeff jeffy answered 2 years ago
Next > < Previous

Related Solutions

You are now 25 years old, and have just started working. Your salary for this year...
You are now 25 years old, and have just started working. Your salary for this year (i.e., the next 12 months) is $60,000 a year (payable at the end of the year). You expect your salary to increase at the (nominal) rate of 3% per year. You want to retire on your 60 birthday (i.e., 35 years from now). During retirement, you will be happy if you can have $75,000 per year. You expect to live until you are 90...
Suppose that Kevin is a 10 years old boy. He is at the mall with his...
Suppose that Kevin is a 10 years old boy. He is at the mall with his mom, and she gives him some money to get food from the food court. At the food court there is a hamburger place, and an ice cream shop. In the following table, I will show you Kevin's Total Utility for each quantity of Hamburgers and ice cream. Hamburgers ($2) Ice Cream ($1) Quantity Total Utility Marginal Utility MU/P Quantity Total Utility Marginal Utility MU/P...
Several years ago, your client, Brooks Robinson, started an office cleaning service. His business was very...
Several years ago, your client, Brooks Robinson, started an office cleaning service. His business was very successful, owing much to his legacy as the greatest defensive third baseman in major league history and his nickname, “The Human Vacuum Cleaner.” Brooks operated his business as a sole proprietorship and used the cash method of accounting. Brooks was advised by his attorney that it is too risky to operate his business as a sole proprietorship and that he should incorporate to limit...
Several years ago, your client, Brooks Robinson, started an office cleaning service. His business was very...
Several years ago, your client, Brooks Robinson, started an office cleaning service. His business was very successful, owing much to his legacy as the greatest defensive third baseman in major league history and his nickname, “The Human Vacuum Cleaner.” Brooks operated his business as a sole proprietorship and used the cash method of accounting. Brooks was advised by his attorney that it is too risky to operate his business as a sole proprietorship and that he should incorporate to limit...
Tracy started his sole proprietorship business two years ago and has never sold a §1231 asset....
Tracy started his sole proprietorship business two years ago and has never sold a §1231 asset. Tracy owned each of the assets for the entire 2 years he has been in business. In the current year, he sold the following business assets: Asset Original Cost Accumulated Depreciation Gain/Loss Desks $8,000 $2,000 ($2,000) Truck 12,000 6,000 (6,000) Equipment 18,000 12,000 13,500 Building 150,000 10,000 25,000Assuming Tracy’s marginal ordinary income tax rate is 30 percent, what is the character of Tracy’s gains...
Today, you earn a salary of $75,500. What was your annual salary be five years ago...
Today, you earn a salary of $75,500. What was your annual salary be five years ago if you receive annual raises of 3.6%? Select one: a. $62,230 b. $62,844 c. $58,213 d. $63,263 e. $63,441
Imagine that you are working with Kevin Mills, 78 years old, who lives alone in an...
Imagine that you are working with Kevin Mills, 78 years old, who lives alone in an independent living unit. Mills has type 1 diabetes. You visited Mills today to check his blood sugar and ensure that he maintains his health in his best possible way in relation to the agreed NCP. Mills' daughter is at home now and she visits Mills two days a week to ensure his welfare. 2.1~Mills' blood sugar is 10.2mmol/L at 10:00 am. He had his...
Kevin is single. In 2017, he earned $65,000 in salary this year from his employer and received $10,000 in alimony from his ex-wife.
Kevin is single. In 2017, he earned $65,000 in salary this year from his employer and received $10,000 in alimony from his ex-wife. His employer withheld $9,000 in tax from his salary this year. In addition to the above, the following occurred this year:- He decided he did not like his nose. So he paid $2,000 in cosmetic surgery to make it larger and more defined.- He paid $2,500 in union dues and for subscriptions to publications related to his...
a)When your father was born 47 years ago, his grandparents deposited $175 in an account for...
a)When your father was born 47 years ago, his grandparents deposited $175 in an account for him. Today, that account is worth $1,900. What was the annual rate of return on this account? 5.21 percent 5.00 percent 4.86 percent 3.89 percent 5.73 percent 1)Todd can afford to pay $390 per month for the next 7 years in order to purchase a new car. The interest rate is 6.8 percent compounded monthly. What is the most he can afford to pay...
4) Imagine that you are working with Kevin Mills, 78 years old, who lives alone in...
4) Imagine that you are working with Kevin Mills, 78 years old, who lives alone in an independent living unit. Mills has type 1 diabetes. You visited Mills today to check his blood sugar and ensure that he maintains his health in his best possible way in relation to the agreed NCP. Mills' daughter is at home now and she visits Mills two days a week to ensure his welfare. 4.1) Mills' blood sugar is 10.2mmol/L at 10:00 am. He...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT