Inflation Calculator: http://www.bls.gov/data/inflation_calculator.htm 1. Your employment contract calls for a 6% raise every three years. If you began your employment at the beginning of 2010, what was your first effective raise (i.e., taking inflation into account), applied at the beginning of 2013? Inflation rates. a. Use the inflation rate calculator to find the inflation rate (as a percent) i. from 1995 to 2005, ii. from 2005 to 2015, and iii. from 1995 to 2015. b. Explain why the inflation rate from 1995 to 2015 is not just the sum of the rate from 1995 to 2005 and the rate from 2005 to 2015. c. Use the proper method to compute the inflation rate from 1995 to 2015 correctly from the two rates for the two previous decades. 3. According to the United States Department of Treasury, the national debt [also known as gross government debt] on January 1, 2013, was $16,432,730,050,569.12 ~ $16.5 trillion. Remember to show all work and identify your sources. a. Calculate, to the nearest thousand, the average share of the debt for each person in the United States in 2013. b. By some estimates, this debt increases at an average of just $2.5 billion per day. Estimate the total increase in the debt for one year, to the nearest billion. C. Use the web to find the current national debt of the United States and check if the value supports the claim in (b); then update the average per capita share of the debt. 4. Stella's current salary is $80,000. Assuming that the current annual inflation rate is 4%, consider these two different ways to calculate a raise that's "10% over the rate of inflation": a. What is Stella's new salary if you simply add the inflation rate to her 10% raise and use that as her percentage raise? b. What will she earn if you first compute her salary after the 10% increase and then increase that to take inflation into account? c. Which is the best approach (for Stella - since it's her salary)? 5. The Fort Wayne, IN Journal Gazette reported on July 10, 2010, that: "Private institutions, on average, laid out $19,520 per student for instruction [in 2007], a 22 percent increase from a decade earlier," the Delta Project on Postsecondary Education Costs, Productivity, and Accountability, a Washington-based nonprofit research group said Friday. Public universities spent $9,732 for each student, up 10% in the decade, according to the report. a. How much did private colleges spend per student in 1997? b. When adjusted for inflation, what was the actual percent change in the amount spent per student by private colleges from 1997 to 2007? (You may use any method; it may help to treat the increase in expenditures as "a raise" and use the same approach we used in class to find the "real raise," or "pay cut," if applicable.) C. How much did public colleges spend per student in 1997? d. When adjusted for inflation, what was the actual percent change in the amount spent per student by public colleges from 1997 to 2007