Econ1101 Macro Principles -001Homework: Homework - ChapterLindsay Cola &9/26/19 5:20 PM6Score: 0.33 of 1 ptSave13 of 25 (13 complete)Text Problem 9HW Score: 47.33 %, 11.83 of 25 ptsQuestion HelpIn addition to the national Consumer Price Index (CPI) discussed in this chapter, the Bureau of Labor Statistics produces several regional CPI indices. These are constructed in the same way as the national CPI, just at a smaller scale: in a givencity, researchers gather prices for a bundle of goods every month and then construct an index to track price changes of that bundle within the city. The following table shows the CPI indices (base period 1982-1984 100) for SanFrancisco-Oakland-San Jose and Los Angeles-Riverside-Orange County, from 2007 to 2014:YearLos Angeles-Riverside-OrangeCountrySan Francisco-Oakland-San Jose2007216.048217.3382008222.767225.0082009224.395223.2192010227.469225.8942011233.390231.9282012239.650236.6482013245.023239.2072014251.985242.434In 2014, the San Francisco-Oakland-San Jose CPI was 251.985, while the Los Angeles-Riverside-Orange County CPI was 243.434.Using the information given above, which of the following statements is true?OA. Prices are higher in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County.B. Prices have increased more in Los Angeles-Riverside-Orange County than in San Francisco-Oakland-San Jose since the base period.O C. Prices are lower in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County.D.Prices have increased more in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County since the base period.Suppose a San Francisco resident and a Los Angeles resident each make the same nominal wage every year from 2008 to 2014: $63,000.00 a year.percent. ((Use "-" sign if required, and round yourUsing the table above, the percentage change in real wage in San Francisco from 2008 to 2014 wasresponse to the nearest two decimal places)percent. The percentage change in real wage in Los Angeles from 2008 to 2014 wasnter your answer in the edit fields and then click Check Answer.Final CheckClear Alll parts showing

Question
Asked Sep 26, 2019
Econ1101 Macro Principles -001
Homework: Homework - Chapter
Lindsay Cola &9/26/19 5:20 PM
6
Score: 0.33 of 1 pt
Save
13 of 25 (13 complete)
Text Problem 9
HW Score: 47.33 %, 11.83 of 25 pts
Question Help
In addition to the national Consumer Price Index (CPI) discussed in this chapter, the Bureau of Labor Statistics produces several regional CPI indices. These are constructed in the same way as the national CPI, just at a smaller scale: in a given
city, researchers gather prices for a bundle of goods every month and then construct an index to track price changes of that bundle within the city. The following table shows the CPI indices (base period 1982-1984 100) for San
Francisco-Oakland-San Jose and Los Angeles-Riverside-Orange County, from 2007 to 2014:
Year
Los Angeles-Riverside-Orange
Country
San Francisco-Oakland-San Jose
2007
216.048
217.338
2008
222.767
225.008
2009
224.395
223.219
2010
227.469
225.894
2011
233.390
231.928
2012
239.650
236.648
2013
245.023
239.207
2014
251.985
242.434
In 2014, the San Francisco-Oakland-San Jose CPI was 251.985, while the Los Angeles-Riverside-Orange County CPI was 243.434.
Using the information given above, which of the following statements is true?
OA. Prices are higher in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County.
B. Prices have increased more in Los Angeles-Riverside-Orange County than in San Francisco-Oakland-San Jose since the base period.
O C. Prices are lower in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County.
D.
Prices have increased more in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County since the base period.
Suppose a San Francisco resident and a Los Angeles resident each make the same nominal wage every year from 2008 to 2014: $63,000.00 a year.
percent. ((Use "-" sign if required, and round your
Using the table above, the percentage change in real wage in San Francisco from 2008 to 2014 was
response to the nearest two decimal places)
percent. The percentage change in real wage in Los Angeles from 2008 to 2014 was
nter your answer in the edit fields and then click Check Answer.
Final Check
Clear All
l parts showing
help_outline

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Econ1101 Macro Principles -001 Homework: Homework - Chapter Lindsay Cola &9/26/19 5:20 PM 6 Score: 0.33 of 1 pt Save 13 of 25 (13 complete) Text Problem 9 HW Score: 47.33 %, 11.83 of 25 pts Question Help In addition to the national Consumer Price Index (CPI) discussed in this chapter, the Bureau of Labor Statistics produces several regional CPI indices. These are constructed in the same way as the national CPI, just at a smaller scale: in a given city, researchers gather prices for a bundle of goods every month and then construct an index to track price changes of that bundle within the city. The following table shows the CPI indices (base period 1982-1984 100) for San Francisco-Oakland-San Jose and Los Angeles-Riverside-Orange County, from 2007 to 2014: Year Los Angeles-Riverside-Orange Country San Francisco-Oakland-San Jose 2007 216.048 217.338 2008 222.767 225.008 2009 224.395 223.219 2010 227.469 225.894 2011 233.390 231.928 2012 239.650 236.648 2013 245.023 239.207 2014 251.985 242.434 In 2014, the San Francisco-Oakland-San Jose CPI was 251.985, while the Los Angeles-Riverside-Orange County CPI was 243.434. Using the information given above, which of the following statements is true? OA. Prices are higher in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County. B. Prices have increased more in Los Angeles-Riverside-Orange County than in San Francisco-Oakland-San Jose since the base period. O C. Prices are lower in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County. D. Prices have increased more in San Francisco-Oakland-San Jose than in Los Angeles-Riverside-Orange County since the base period. Suppose a San Francisco resident and a Los Angeles resident each make the same nominal wage every year from 2008 to 2014: $63,000.00 a year. percent. ((Use "-" sign if required, and round your Using the table above, the percentage change in real wage in San Francisco from 2008 to 2014 was response to the nearest two decimal places) percent. The percentage change in real wage in Los Angeles from 2008 to 2014 was nter your answer in the edit fields and then click Check Answer. Final Check Clear All l parts showing

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Expert Answer

Step 1

Real wage refers to the number of goods that an individual can purchase from wages earned. Real wage is also referred to the nominal wages that are adjusted for inflation and can be calculated by the formula given below.

Real Wage =Nominal Wage
-x100
CPI
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Real Wage =Nominal Wage -x100 CPI

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Step 2

It is provided that wages earned San Francisco resident earns a nominal income of $63000 per year from year 2008 to 2014 and CPI for 2008 and 2014 are 222.767 and 251.985 respectively. So real wages in the year 2008 was $28280.67 and real wage in year 2014 was $25001.49.

$63000100
RW2008222.767
$28280.67
$63000100
RW2014251.985
=$25001.49
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$63000100 RW2008222.767 $28280.67 $63000100 RW2014251.985 =$25001.49

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Step 3

The percentage change in real income of San Francisco from year 2008 to 2014 was -11.6% ...

RWY014-RW
2008
Percentage change in Real wage=-
-x 100
RW
2008
$25001.49-$28280.67
-x100
$28280.67
--11.6%
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RWY014-RW 2008 Percentage change in Real wage=- -x 100 RW 2008 $25001.49-$28280.67 -x100 $28280.67 --11.6%

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