Give step-by-step solution with explanation and final answer:
solve both a and b also provide formula for excel5 According to the New Hampshire Department of Education, the average teacher salary in

Question

Give step-by-step solution with explanation and final answer:
solve both a and b also provide formula for excel5 According to the New Hampshire Department of Education, the average teacher salary in public school districts in New Hampshire
was $46,027 in 2006, $47,497 in 2007, and $46,027 in 2008.
10 Use the following information on CP and PP!
points
Year CPI (1962 - 84 = 100) PPI (1982 = 100)
EE) won 201.59 164.80
2007 207.34 172.70
2008 215.30 189.60
2009 214.54 172.90
eBook
foresees SOUrCe: Bureau of Labor Statistics.
a. Calculate the real salary for the teachers. (Round your answers to 2 decimal places.)
[for [1]
[00s [7]

b. Calculate the percentage change in the dollar value (nominal) as well as the purchasing power (real) of salaries. (Leave no cells
blank - be certain to enter "0" wherever required. Negative values should be indicated by a minus sign. Round your answers to 2
decimal places.)

[eur | Nominal Sai | resi saay |

EI A

IE A

EI A SC

VIPSolutions · Accepted Answer

# Step-by-Step Solution

## a. **Calculate the Real Salary for Teachers**

**Formula:**
$$
\text{Real Salary} = \frac{\text{Nominal Salary}}{\text{CPI}} \times 100
$$

### Given Data

| Year | Nominal Salary | CPI      |
|------|---------------|----------|
| 2006 | $46,027       | 201.59   |
| 2007 | $47,497       | 207.34   |
| 2008 | $46,027       | 215.30   |

### Calculations

#### **2006:**
$$
\text{Real Salary} = \frac{46,027}{201.59} \times 100 = 22,822.77
$$

#### **2007:**
$$
\text{Real Salary} = \frac{47,497}{207.34} \times 100 = 22,911.91
$$

#### **2008:**
$$
\text{Real Salary} = \frac{46,027}{215.30} \times 100 = 21,384.97
$$

### **Completed Table:**

| Year | Real Salary   |
|------|--------------|
| 2006 | $22,822.77   |
| 2007 | $22,911.91   |
| 2008 | $21,384.97   |

---

## b. **Calculate Percentage Changes**

### **Percentage Change Formula:**

$$
\text{Percent Change} = \frac{\text{New Value} - \text{Old Value}}{\text{Old Value}} \times 100
$$

### **Nominal Salary Changes:**

- 2006: N/A (no previous year) → 0%
- 2007: $\frac{47,497 - 46,027}{46,027} \times 100 = 3.19\%$
- 2008: $\frac{46,027 - 47,497}{47,497} \times 100 = -3.09\%$

### **Real Salary Changes:**

- 2006: N/A (no previous year) → 0%
- 2007: $\frac{22,911.91 - 22,822.77}{22,822.77} \times 100 = 0.39\%$
- 2008: $\frac{21,384.97 - 22,911.91}{22,911.91} \times 100 = -6.67\%$

### **Completed Table:**

| Year | Nominal Salary % Change | Real Salary % Change |
|------|------------------------|---------------------|
| 2006 | 0                      | 0                   |
| 2007 | 3.19                   | 0.39                |
| 2008 | -3.09                  | -6.67               |

---

## **Excel Formulas**

Assume:
- Nominal Salary in cells B2:B4
- CPI in cells C2:C4

**Real Salary (in D2):**
```
= (B2/C2)*100
```
Drag formula down for the other years.

**Percentage Change for 2007 Nominal Salary (E3):**
```
= ((B3-B2)/B2)*100
```
Drag formula down for the other years.

**Percentage Change for 2007 Real Salary (F3):**
```
= ((D3-D2)/D2)*100
```
Drag formula down for the other years.

---

## **Summary Table**

| Year | Real Salary | Nominal Salary % | Real Salary % |
|------|-------------|------------------|---------------|
| 2006 | $22,822.77  | 0.00             | 0.00          |
| 2007 | $22,911.91  | 3.19             | 0.39          |
| 2008 | $21,384.97  | -3.09            | -6.67         |

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