Money_Word_Problems: In 1950, the average price of a car was about $2000. This may sound inexpensive but the average income in 1950 was much less than it is now. To compare dollar amounts over time, use the formula V=A/S(C), where A is the old dollar amount, S is the starting years Consumer Price Index (CPI), C is thye converting years CPI, and V is the current value of the old dollar amount. Buying a car for $2000 was like buying a car for ho much money in the year 2000?

Question

Money_Word_Problems: In 1950, the average price of a car was about $2000. This may sound inexpensive but the average income in 1950 was much less than it is now. To compare dollar amounts over time, use the formula V=A/S(C), where A is the old dollar amount, S is the starting years Consumer Price Index (CPI), C is thye converting years CPI, and V is the current value of the old dollar amount. Buying a car for $2000 was like buying a car for ho much money in the year 2000?

(USE THIS CHART)
Year Average CPI
1950 42.1
1960 29.6
1970 38.8
1980 82.4
1990 130.7
2000 174.0

Answer 1

To find out how much buying a car for $2000 in 1950 was like in the year 2000, we can use the formula V=A/S(C), where A is the old dollar amount, S is the starting year's CPI, C is the converting year's CPI (in this case 2000), and V is the current value of the old dollar amount.

A = $2000 (price of a car in 1950)
S = 42.1 (CPI in 1950)
C = 174.0 (CPI in 2000)

Now we can plug these values into the formula:
V = 2000 / (42.1) * (174)

V = 2000 / 42.1 * 174

V = 47.51 * 174

V = $8264.74

So buying a car for $2000 in 1950 was like buying a car for approximately $8264.74 in the year 2000.

Answer 2

To find out how much buying a car for $2000 in 1950 is equivalent to in the year 2000, we can use the formula V = A / S(C), as mentioned in the problem.

Given:
- A (old dollar amount) = $2000
- S (starting years CPI) = CPI in 1950 = 42.1
- C (converting years CPI) = CPI in 2000 = 174.0
- V (current value of the old dollar amount) = ?

Substituting the values into the formula, we have:

V = $2000 / (42.1 / 174.0)

Now, let's calculate the value:

V = $2000 / (0.2413)

V ≈ $8277.13

Therefore, buying a car for $2000 in 1950 is equivalent to buying a car for approximately $8277.13 in the year 2000.

Answer 3

To calculate the equivalent value of $2000 in the year 2000, we will use the formula V = A/S(C), where:

V is the current value of the old dollar amount,
A is the old dollar amount ($2000 in this case),
S is the starting year's Consumer Price Index (CPI),
C is the converting year's CPI.

Using the given chart, we can find the CPI values for the starting year (1950) and converting year (2000):

For 1950: S = 42.1 (starting year's CPI)
For 2000: C = 174.0 (converting year's CPI)

Now, we can substitute these values into the formula to find the equivalent value:

V = $2000 / 42.1 * 174.0

Calculating this equation:

V = $2000 / 42.1 * 174.0 = $16070.07

Therefore, buying a car for $2000 in 1950 would be like buying a car for approximately $16,070.07 in the year 2000.