Samantha deposits $2000 into a saving account that pays an annual interest rate of 5 percent.Over the course of a year,the inflation rate is 2 percent.What happens at the end of the year?
A) Samantha has $100 more in her account,and her purchasing power has increased by about $40.
B) Samantha has $100 more in her account,and her purchasing power has increased by about $60.
C) Samantha has $140 more in her account,and her purchasing power has increased about $100.
D) Samantha has $140 more in her account,and her purchasing power has increased about $40.
Correct Answer:
Verified
Q148: In the late 1970s, nominal interest rates
Q149: The CPI is computed by finding the
Q150: Ms. Smith borrowed $1000 from her bank
Q153: What happened in the early 2000s?
A) Real
Q156: The inflation rate is computed as 100
Q157: If the current-year CPI is 140, then,
Q158: Which statement best describes nominal interest rates
Q160: Substitution bias in computing the CPI tends
Q169: If you currently make $25,000 a year
Q178: Compute how much each of the following
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents