Excuse the weird title, but I think a. Example should make it clearer, when people say: person A had money in 1900, say 100,000$, that is equal to 1,000,000$ in todays money?
How does that work?
Or what do they mean exactly?
Like if my Great grandfather had 1 million that remained untouched till this day shouldn’t that 1 million remain as a 1 million even today?
In: Economics
They generally mean that the value of how much $1 can purchase has shifted over time, and that a person making $100,000 in 1900 is like a person making $10,000,000 today. It’s helpful for people to understand roughly how rich someone was, because back in a day when a house might be a few hundred dollars, owning thousands of dollars was a big deal, whereas today owning thousands of dollars won’t get you much at all.
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