The price of a first class stamp is .42 cents in 2009. The price of the same first class stamp in 1975 was .13 cents. The price index in 1975 was 75 and price index in 2009 will be 218. After adjusting for inflation, how much more expensive is the stamp in 2009 than the stamp in 1975? Have stamp prices kept pace with the inflation rate from 1975 to 2009? show your work.
Solution
Following details are available from the sum:
Year
Price (Cents)
Price index
1975
0.13
75
2009
0.42
218
Considering the above details, the price of stamp in 2009 would be as below:
Price of stamp in 2009 = (Price index of 2009 / Price index of 1975)
.
The price of a first class stamp is -42 cents in 2009- The price of th.docx
1. The price of a first class stamp is .42 cents in 2009. The price of the same first class stamp in
1975 was .13 cents. The price index in 1975 was 75 and price index in 2009 will be 218. After
adjusting for inflation, how much more expensive is the stamp in 2009 than the stamp in 1975?
Have stamp prices kept pace with the inflation rate from 1975 to 2009? show your work.
Solution
Following details are available from the sum:
Year
Price (Cents)
Price index
1975
0.13
75
2009
0.42
218
Considering the above details, the price of stamp in 2009 would be as below:
Price of stamp in 2009 = (Price index of 2009 / Price index of 1975)
Year Price (Cents) Price index
1975 0.13 75
2009 0.42 218
