# A dozen eggs cost $0.88 in January 1980 and$2.11 in January 2015. The average wage for production workers was $7.58 per hour in January 1980 and$19.64 in January 2015. a. By what percentage did the price of eggs rise? b. By what percentage did the wage rise? c. In each year, how many minutes did a worker have to work to earn enough to buy a dozen eggs? d. Did workers’ purchasing power in terms of eggs rise or fall?

### Brief Principles of Macroeconomics...

8th Edition
N. Gregory Mankiw
Publisher: Cengage Learning
ISBN: 9781337091985

### Brief Principles of Macroeconomics...

8th Edition
N. Gregory Mankiw
Publisher: Cengage Learning
ISBN: 9781337091985

#### Solutions

Chapter
Section
Chapter 6, Problem 7PA
Textbook Problem

## A dozen eggs cost $0.88 in January 1980 and$2.11 in January 2015. The average wage for production workers was $7.58 per hour in January 1980 and$19.64 in January 2015.a. By what percentage did the price of eggs rise?b. By what percentage did the wage rise?c. In each year, how many minutes did a worker have to work to earn enough to buy a dozen eggs?d. Did workers’ purchasing power in terms of eggs rise or fall?

Expert Solution

Subpart (a):

To determine

Measuring the changes in price, wages and purchasing power.

### Explanation of Solution

Percentage rise in price is calculated as follows:

Percentage change in price =PricePresentPricePreviousPricePrevious×100=2

Expert Solution

Subpart (b):

To determine

Measuring the changes in price, wages and purchasing power.

Expert Solution

Subpart (c):

To determine

Measuring the changes in price, wages and purchasing power.

Expert Solution

Subpart (d):

To determine

Measuring the changes in price, wages and purchasing power.

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