At the time this book went to print, the minimum wage was $7.25. To find the current value of the CPI, go to www.bls.gov/CPI/home.htm. Click on “CPI Tables,” which is found on the left side of the web page. Then, click on “Table Containing History of CPI-U U.S. All Items Indexes and Annual Percent Changes from 1913 to Present.” This will give you the CPI from 1913 to the present.
a. With these values, calculate the current real minimum wage in 1990 dollars.
b. Stated in real 1990 dollars, what is the percentage change in the real minimum wage from 1985 to the present?