Question

calculate the average growth rate from the early federal minimum wage from $0.25 in 1938 to $7.25 in 2020 round to the third decimal place

Answer 1

we need to calculate the average growth rate from 1938 to 2020. In order to do so, we will use the following formula:

`R=(y_1-y_2)/(x_1-x_2)`

where,

R is the growth rate,

y1 is $0.25

y2 is $7.25

x1 is 1938, and

x2 is 2020

now, let's replace and solve

`R=(0.25-7.25)/(1938-2020)`
`R=(7)/(82)`

we can see that the growth rate is $7 in 82 years, this is the same as $0.085 per year.

In summary

In order to calculate the average growth rate from the early federal minimum wage from 1938 to 2020, first we need to calculate the difference between $7.25 and $0.25, this is $7 and then divide it by the number of years of this period (82). Therefore, the answer is 7/82=0.085