Atlanta, GA has a CPI of 168. Seattle, WA has a CPI of 204. How does the purchasing power of an Atlanta resident earning a $32,800 salary compare to the purchasing power of a Seattle resident earning a $46,400 salary?
Answer
A
The Atlanta resident has $34.46/CPI more than the Seattle resident.
B
The Atlanta resident has $83.20/CPI more than the Seattle resident.
C
The Seattle resident has $48.74/CPI more than the Atlanta resident.
D
The Seattle resident has $32.21/CPI more than the Atlanta resident.
Explanation
Compare each salary after adjusting for the local CPI: Atlanta’s purchasing-power measure is $32,800 ÷ 168 ≈ $195.24 per CPI point, while Seattle’s is $46,400 ÷ 204 ≈ $227.45. Seattle’s measure is about $227.45 − $195.24 = $32.21 higher. Therefore, the Seattle resident has $32.21/CPI more purchasing power than the Atlanta resident.
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