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Safari Fle Edit View History Bookmarks Window Help MindTap- Cengage MINDTAP Homework (Ch 11) 3. Comparing salaries from different timer Consider gollers who led the Professional Go fers' Association of America (PGA) in winningsdifferent points in time. Note that the winnings are nominal figures (unadjusted for inflation) To convert the oniginal earmings of Nicklaus, Trevino, and Stadier, use the formulia for converting dollar nigures from an earfer era into year 2009 U.S dollars. Using those figures'the fonowing table, making sure to round your responses to the nearest US, dollar, Nominal Winnings u.s Year Golfer (Dollars) (1983 100) Winnings in 2009 Dollars 1965 Jack Nickiaus 1970 Lee Trevino 1982 Caig Stader 2009 Tiger Woods10,508,163 31.5 140,752 157,037 444,462 96.5 214.5 10,508,163 True or False: According to he previous table, the golfer with the highest PGA winnings in nominal dollars is not the same as the golfer with the highest PGA winnings after adjusting for infilation. True

Explanation / Answer

Note that the value of money in any given year (based on 2009 dollars) is computed as

Value of money in the given year x CPI of 2009/CPI of given year

Use this to find the value of earnings in different years

The statement is False because even after adjusting for inflation, Tiger woods still earned highest among all.

Year Name Earning Index Earning In 2009 dollars 1965 JN 140752 31.5 958,454 1970 LT 157037 38.8 868,156 1982 CS 446462 96.5 992,395 2009 TW 10508163 214.5 10,508,163

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