When Julie entered college in 2011, she dreamed of making $50,000 when she graduated. The CPI in 2011 was 226.4. Julie graduated in 2016. (Thinking about money rather than studies slowed her progress a bit.) The 2016 CPI was 237.1. What must Julie earn in order to have the same buying power that $50,000 had in 2011?
A) About $105,800
B) About $94,800
C) About $52,400
D) About $44,800
E) It can't be calculated from the information given.

Question

Quizplus · Accepted Answer

To maintain the same buying power, Julie's salary must adjust according to the change in CPI from 2011 to 2016. The formula to calculate this is: (New CPI / Old CPI) * Old Salary. Plugging in the numbers: (237.1 / 226.4) * $50,000 = approximately $52,400.

When Julie Entered College in 2011, She Dreamed of Making