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Saving vs working

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Based on the chart below, in which year is it best to be a saver? Best to be a worker? Worst to be a saver? Worst to be a worker?

year money/wage cpi interest rate
1999 7.50 106 6%
2000 7.90 105 7%
2001 8.20 114 8%
2002 8.40 120 7%
2003 8.80 121 7.50%
2004 9.50 130 7%
2005 10.00 140 8%
2006 10.30 145 7.50%
2007 11.10 146 7.00%

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Solution Summary

Decisions on saving vs working based on interest rates.

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Savers are rewarded by the interest rate adjusted for inflation, while workers are rewarded by wage increases adjusted for inflation. To find the changes in wages and inflation, we take the change in ...

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