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Inflation

Inflation. Why does it not always add up?. What is Inflation?. Definition

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Inflation

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  1. Inflation Why does it not always add up?

  2. What is Inflation? • Definition • Inflationis a sustained increase in the general level of prices for goods and services. It is measured as an annual percentage increase. As inflation rises, every dollar you own buys a smaller percentage of a good or service. • In other words • What cost you $100 in 2000 • Cost you $125.26 according to the Bureau of Labor Statistics

  3. Cost from then to now • This is the price of a Ford Coupe in 1926 • $520 • How much would this car cost today? • Bureau of Labor Statistics Inflation rate Calculator • $6,336.74

  4. Cost from now to then • Ford Coupe 2010 • $20,995 - $35,995 • What would this cost in 1926? • Bureau of Labor Statistics Inflation rate Calculator • $1,722.87 - $2,953.79

  5. Why such a difference? • The coupe back then a lower model?

  6. Cost from then to now • In 1921 the Cadillac touring model cost • $3940 • How much would this cost today? • Bureau of Labor Statistics Inflation rate Calculator • $48,013.02

  7. Cost from now to then • Cadillac touring model 2009 • $36,560 - $58,575 • How much would this cost in 1921? • http://www.bls.gov/data/inflation_calculator.htm • $3,034.05 - $4,861.04

  8. The Comparison Then Now • Ford Coupe 1926 • $520 • Ford Coupe 2010 • $1,722 - $1,953 • Cadillac 1921 • $3940 • Cadillac 2009 • $36,560 - $58,575 • Ford Coupe 1926 • $6,336 • Ford Coupe 2010 • $20,995 - $35,995 • Cadillac 1921 • $48,013.02 • Cadillac 2009 • $36,560 - $58,575

  9. Why the difference? • Why is there a difference with the Ford but the Cadillac is closer to the same?

  10. Cost from then to now • Buick Touring Car Model-D 1921 • $650.00 • http://www.bls.gov/data/inflation_calculator.htm • $7,832.43

  11. Cost from now to then • Buick LaCrosse 2010 • $27,085 - $33,015 • http://www.bls.gov/data/inflation_calculator.htm • $2,247.74 - $2,739.86

  12. Why the difference? • Again there is a big difference why?

  13. Comparable?

  14. Comparable? Hudson Coach 1926 Kia Soul 2009 • Cost then • $1,165 • Cost now • $14,196.74 • Cost then • $1,093.87 - $1,390.94 • Cost now • $13,300 - $16,950

  15. Does this transcend other areas?

  16. Assignment Options Research Paper Research Project • Explain why vehicle prices have exceeded the inflation rate. 3 page minium • Take a given 10 year period and chart the price trends for 6 items over that period. And graph the trend to determine future prices.

  17. Research project Example

  18. Any Questoins?

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