Respuesta :
The buying power of a currency is indeed the number of goods and services that can be purchased with a unit of currency. Real earnings, often known as real pay, is the amount of money an individual or institution earns after accounting for inflation, and the further calculation can be defined as follows:
For point a:
[tex]\bold{CPI=131.9}[/tex]
Using formula:
[tex]\text{Purchasing Power of dollar}=\frac{\$1}{CPI} \times 100[/tex]
[tex]\bold{=\frac{\$1}{131.9} \times 100} \\\\\bold{= \$\ 0.00758 \times 100 }\\\\\bold{= \$\ 0.758}[/tex]
Therefore Purchasing Power of the dollar in 2019 compared to 2002 is $0.758
For point b:
[tex]\bold{2019-Income = 62,900}\\\\\bold{CPI=131.9}\\\\[/tex]
Using formula:
[tex]\text{Real Income}=\frac{ \text{Income in 2019}}{CPI} \times 100 \\\\[/tex]
[tex]\bold{=\frac{62900}{131.9}\times 100}\\\\\bold{=476.876421 \times 100}\\\\\bold{= 47687.64}[/tex]
Therefore Real income, relative to 2002 is 47687.64
Learn more:
brainly.com/question/17747677
