The Cost of Living and the Factors that Contribute to the Nation’s Prosperity

Student’s Name
Professor’s Name
Course
Date
Macroeconomics
Chapter 11
The cost of living refers to the finances required to cover necessities, such as taxes, food, healthcare, and housing in a specific place and period. The case study “Regional Differences in the Cost of Living” reveals the measure that is used to compare the cost of living in different states in the United States of America (USA). Indeed, it gives a scenario of how graduates should be careful when choosing job offers from different places. Some jobs have more financial benefits than others. However, the thing that matters the most when selecting the best job offer is the cost of living in that specific place (U.S. Department of Commerce 215). Jobs that have a larger paycheck might not be beneficial in the long run due to the regional differences in the costs of products and services.
In that light, the differences in cost of living are accounted for by the place, period, and prices of commodities and services. Regional price parities (RPP) is the Consumer Price Index (CPI) measure that is used to determine the cost of living in different places. For instance, by referring to Figure 3, Regional Variation in the Cost Living, someone living in Hawaii, District of Columbia, and New York would have to pay more for goods and services than someone in Arkansas, Alabama, and Mississippi. An individual living in Hawaii pay 18.4% more, and the one in Mississippi pays 13.6% less than the average cost of living (U.S. Department of Commerce 216).
Chapter 12
Numerous attributes of ...