Question

Which of the following salaries will have a purchasing power of $24,035 if the inflation rate is five percent?

Answer 1

Answer:

The purchasing power of $24,035 if the inflation rate is five percent is $25300 .

Step-by-step explanation:

Let us assume that the purchasing power of  $24,035 be y .

As given inflation rate is 5% .

(As inflation rate is inversely proportional to purchasing power .)

Assume that purchasing power be 100% .

Thus as inflation rate is increase by 5% than purchasing power decrease by 5 % .

Thus

Purchasing power = (100 - 5)%

                               = 95 %

95% is written in the decimal form .

$=\frac{95}{100}$

= 0.95

Thus the equation becomes

0.95 × y = 24035

$y = \frac{24035}{0.95}$

$y = \frac{24035\times 100}{95}$

$y = \frac{2403500}{95}$

y = $25300

Therefore the purchasing power of $24,035 if the inflation rate is five percent is $25300 .

Answer 2

The answer would be 25,300