Henri earned a salary of $50,000 in 2001 and $60,000 in 2012.The consumer price index was 177 in 2001 and 225 in 2012.Henri's 2001 salary in 2012 dollars is
A)$39,333.33.
B)$74,000.00.
C)$89,333.33.
D)$63,559.32.

Question

Quizplus · Accepted Answer

To find Henri's 2001 salary in 2012 dollars, we need to adjust the 2001 salary for inflation. We can use the formula:

Adjusted salary = (original salary) x (new CPI/old CPI)

Plugging in the numbers we get:

Adjusted salary = (50,000) x (225/177)
Adjusted salary ≈ 63,559.32

Therefore, Henri's 2001 salary in 2012 dollars is approximately $63,559.32.

Henri Earned a Salary of $50,000 in 2001 and $60,000