Question

In: Economics

Michael Jordan Earned $30,100,000 playing for the Chicago Bulls in 1997. In 1997 the CPI was...

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?  

Solutions

Expert Solution

The real wage for Michael Jordan in 1997 = Nominal wage / Price index

                                                                    = 30,100,000 / 1.60

                                                                    = $18,812,500

The real wage for LeBron James in 2020 = 37,400,000 / 2.58

                                                                  = $14,496,124

Rahul Sunny answered 1 year ago
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