Babe Ruth's 1931 salary was $80,000.Government statistics show a consumer price index of 15.2 for 1931 and 237 for 2015.Ruth's 1931 salary was equivalent to a 2015 salary of about
A)$5,296.
B)$1,128,421
C)$1,247,368
D)$17,152,000

Question

Quizplus · Accepted Answer

To adjust a salary from one year to another, we need to use the formula:
Adjusted salary = (original salary) x (new CPI) / (old CPI)
Using the given values, we get:
Adjusted salary in 2015 = $80,000 x 237 / 15.2 = $1,247,368.42 (rounded to the nearest dollar)
Therefore, the closest answer choice is C.

Babe Ruth's 1931 Salary Was $80,000