We first return to the issue of Babe Ruth’s salary. Was his salary of $80,000 in 1931 high or low compared to the salaries of today’s players To answer this question, we need to know the level of prices in 1931 and the level of prices today Part of the increase in baseball salaries merely compensates players for the higher level of prices today To compare Ruth’s salary to those of today’s players, we need to inflate Ruth’s salary to turn 1931 dollars into today’s dollars.

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