What is the Impact of CPI on Real Salary Calculations?

AI Thread Summary
The discussion focuses on the impact of the Consumer Price Index (CPI) on real salary calculations. The user presents a table with yearly income, CPI values, and their calculated real salaries for the years 1999 to 2003. There is uncertainty about the accuracy of these calculations and how to approach a follow-up question regarding salary adjustments. Responses confirm that the calculations appear correct and emphasize that if real salaries decline in relation to CPI, it indicates that salaries are not keeping pace with inflation. The overall conclusion highlights the importance of understanding how CPI affects real income over time.
lms
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I need HELP (new)

a)
yearl income CPI Real Salary (my answer)

1999 20,500 98.5 20,812.18
2000 21,100 100.0 21,100.00
2001 21,400 102.8 20,817.12
2002 22,000 105.5 20,853.08
2003 22,300 109.7 20,328.17
2001 22,900 116.0 19,741.38

i am not sure i do it is right or wrong, and i haven't idea to do (b)
anyone can help me to solve the problem?
the question attach on the file.
 

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You're not likely to find many economists on this board. Maybe someone who has taken some economics courses is around, but help may be slow in arriving for these types of questions.

That said, if all you're supposed to do is adjust the income by the percent change in CPI, which is what you've done and I think is correct, then part (b) seems to be a rather straightforward question based on your answers to part (a). Just look at your answers and see if the salary has kept up with inflation.
 
lms said:
a)
yearl income CPI Real Salary (my answer)

1999 20,500 98.5 20,812.18
2000 21,100 100.0 21,100.00
2001 21,400 102.8 20,817.12
2002 22,000 105.5 20,853.08
2003 22,300 109.7 20,328.17
2001 22,900 116.0 19,741.38

i am not sure i do it is right or wrong, and i haven't idea to do (b)
anyone can help me to solve the problem?
the question attach on the file.
Your numbers for a look good. For b if the sarary keep pace with inflation the adjusted salary does not go down, but you see it does do down so the complaint is justified.
 
thanks so much of your help.
 

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