Question

(e) Use the estimates from (c) and (d) to calculate the relative change in the average household income from 2002 to 2012. Round to the nearest one percent. Indicate if the change is an increase or decrease.Answer of (c): $ 54,000Answer of (d): $ 51,000

Answer 1

The relative change is calculated by dividing the absolute change (the subtraction of the values) by the initial value.

The absolute change is the final value minus the initial value:

`\text{absolute}=51000-54000=-3000`

Now, calculating the relative change, we have:

`\text{relative}=(-3000)/(54000)=-(3)/(54)=-(1)/(18)=-0.0555=-5.55\text{\%}`

Rounding to the nearest percent, the relative change is -6%. Since it's negative, this change indicates a decrease.