9 Problems and Applications Q6 The New York Times cost 015 i

9. Problems and Applications Q6 The New York Times cost $0.15 in 1970 and $2.00 in 2011. The average wage in manufacturing was $3.36 per hour in 1970 and $23.09 in 2011. By what percentage did the price of a newspaper rise? O 12% O 92.5% O 185% 1,233% By what percentage did the wage rise? O 6% O 20% 587% 600% In order to earn enough to buy a newspaper, a worker had to work minutes in 1970 and minutes in 2011. Workers\' purchasing power in terms of newspapers between 1970 and 2011.

Solution

Price of newspaper rises by {(2-0.15)/0.15}*100=1233%. The fourth option is correct.

The wage rises by {(23.09-3.36)/3.36}*100=587%. The third option is correct.

In 1970, $3.36 earned by 60 minutes

Therefore $0.15 earned by (60/3.36)*0.15=2.68 minutes

In 2011, $23.09 earned by 60 minutes

Therefore $2 earned by (60/23.09)*2=5.2 minutes.

In order to earn enough to buy a newspaper, a worker had to work 2.68 minutes in 1970 and 5.2 minutes in 2011.

Workers have to work more to buy a newspaper in 2011 than that of 1970. So Worker\'s purchasing power in terms of newspaper decrease between 1970 and 2011.