Wally has been saving every penny to buy himself a fishing boat when he turns eighteen.First, he selected the model boat he wanted, and then, over the past five years, has managed to save $10,000, price of the boat, from working at summer and after-school jobs.When Wally arrives at the boat dealership on his eighteenth birthday, he is disappointed to learn that the same boat now costs $11,200.The most likely reason for the price increase is:

Question

Quizplus · Accepted Answer

The price of the boat has increased, which suggests inflation. However, it is also possible that the cost of building materials or other expenses related to the production of the boat have increased, which would be a cost increase. Therefore, the most likely reason for the price increase is a combination of inflation and cost increases.

Wally Has Been Saving Every Penny to Buy Himself a Fishing