Question

From1962 to1964, federal spending on nondefense-related education and training rose from $1.31 billion to $1.61 billion, while from 2012 to 2014, it rose from $96.9 billion to $99.5 billion. given that the CPI( in January )was 30.0 in 1962, 30.9 in 1964, 226.7 in 2012, and 233.9 in 2014, which was the larger increase in education and training spending?

Answer 1

Spending rises from $1.31 to $1.61 billion in 1962 to 1964 when CPI rises from 30 to 30.9

If we calculate spending of 1964 on the basis on CPI in 1962, it would be [1.61 * (30 / 30.9)] = 1.56. %change in actual spending on the basis of purchasing power is [1.56 / 1.31] * 100 = 19.32%

Spending rises from $96.9 to $99.5 billion in 2012 to 2014 when CPI rises from 226.7 to 233.9

If we calculate spending of 2014 on the basis on CPI in 2012, it would be [99.5 * (226.7 / 233.9)] = 96.43. %change in actual spending on the basis of purchasing power is [96.43 / 96.9] * 100 = -0.48%

Thus, spending increased by larger during 1962 to 1964.