Question
John has two job offers: 1. Company A in NYC offers him $80,000 2. Company B in Indy offers him $48,000 John likes these two
John has two job offers:
1. Company A in NYC offers him $80,000
2. Company B in Indy offers him $48,000
John likes these two jobs equally and he is indifferent between a quieter life and a glamorous city life. His dad, Bob tries to help him make decision. He has come across some CPI data for cities in the US in a magazine one day; CPI in NYC is 120 and CPI in Indy is 80.
i) Calculate the real income for each city given the offers. Which offer is better for John?
ii) How much does John have to make in NYC to have the same purchasing power as he would in Indy with $48,000?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started