What is the value of a dollar in 1989 compared to 2008?

Answer 1

To answer this question you will want to reference the Bureau of Labor Statistics Website: www.bls.gov. From there you can get information about each year's Consumer Price Index (CPI). The CPI takes a "basket" of goods and compares the prices of these goods month to month and year to year. The CPI is based on how much of this basket a dollar can buy.

I have used the Annual Average CPI for both years from the A;ll Urban Consumers (Current Series) Data Table.

The equation to solve this problem is as follows:

1989 1$ (CPI 2008/CPI 1989) = 1989 1$ stated in 2008$

So:

1(215.303/124.0) = $1.74

To state this in words: $1.00 in 1989 would buy the same amount of goods as $1.74 would buy in 2008.