4. The operating budget estimate for an engineering staff for fiscal year 2004 is $1,780,000. The actual budget expenditures of the staff for the previous 3 fiscal years, as well as estimates for the next 3 years, are as shown in the following table. These are actual dollar amounts. Management, however, also wants annual budget amounts for these years, using a constant dollar perspective. The 2004 fiscal year is to be used for this purpose as base year. The estimated annual general price inflation rate is 6%. What are the annual constant dollar budget amounts? Fiscal year 2001 2002 2003 2004 2005 2006 2007 Budget amount (actual dollars) $ 1,598,000 I $ 1,615,000 $ 1,728,000 $ 1,780,000 $ 1,858,300 $ 1,912,200 $ 1,936,000 Budget amount (constant dollars)

4. The operating budget estimate for an engineering staff for fiscal year 2004 is $1,780,000. The actual budget expenditures of the staff for the previous 3 fiscal years, as well as estimates for the next 3 years, are as shown in the following table. These are actual dollar amounts. Management, however, also wants annual budget amounts for these years, using a constant dollar perspective. The 2004 fiscal year is to be used for this purpose as base year. The estimated annual general price inflation rate is 6%. What are the annual constant dollar budget amounts? Fiscal year 2001 2002 2003 2004 2005 2006 2007 Budget amount (actual dollars) $ 1,598,000 I $ 1,615,000 $ 1,728,000 $ 1,780,000 $ 1,858,300 $ 1,912,200 $ 1,936,000 Budget amount (constant dollars)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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Question

4. The operating budget estimate for an engineering staff for fiscal year 2004 is $1,780,000. The actual
budget expenditures of the staff for the previous 3 fiscal years, as well as estimates for the next 3
years, are as shown in the following table. These are actual dollar amounts. Management, however,
also wants annual budget amounts for these years, using a constant dollar perspective. The 2004 fiscal
year is to be used for this purpose as base year. The estimated annual general price inflation rate is 6%.
What are the annual constant dollar budget amounts?
Fiscal year
2001
2002
2003
2004
2005
2006
2007
Budget amount (actual dollars)
$ 1,598,000
I
$ 1,615,000
$ 1,728,000
$ 1,780,000
$ 1,858,300
$ 1,912,200
$ 1,936,000
Budget amount (constant dollars)

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