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If the average, long term inflation rate is 3%, how many years does it take for prices to double?
24 years
36 years
12 years
6 years
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- Define the stated (quoted) or nominal rate INOM as well as the periodic rate IPER. Will the future value be larger or smaller if we compound an initial amount more often than annually—for example, every 6 months, or semiannually—holding the stated interest rate constant? Why? What is the future value of $100 after 5 years under 12% annual compounding? Semiannual compounding? Quarterly compounding? Monthly compounding? Daily compounding? What is the effective annual rate (EAR or EFF%)? What is the EFF% for a nominal rate of 12%, compounded semiannually? Compounded quarterly? Compounded monthly? Compounded daily?If inflation averages 4 percent per year, how much purchasing power will$1.00 lose in 10 years?If the inflation rate is 5.55% compounded annually, how long will it take for prices to double?
- A series of five payments in constant dollars, beginning with $6,000 at the end ofthe first year, are increasing at the rate of 5% per year. Assume that the averagegeneral inflation rate is 4%, and the market interest rate is 11% during this inflationary period. What is the equivalent present worth of the series?(a) $24,259 (b) $25,892(c) $27,211 (d) $29,406If the rate of inflation is 3.9% per year, the future price pt (in dollars) of a certain item can be modeled by the following exponential function, where t is the number of years from today. =p (t)= 600(1.039)t Find the current price of the item and the price 10 years from today.Round your answers to the nearest dollar as necessary.An economy is experiencing inflation at an annual rate of 8%. If this continues, what will P2000 be worth three years from now in terms of today’s pesos?
- Please answer quickly and correctly Inflation is expected to average 4.4% per year for the next 24 years. How much money will be required, 24 years from now, to buy the same amount of goods and services as $1 does today (to the nearest cent)?a. If the interest rate is 5.0% per year, approximately how long will it take for your money to quadruple in value? (Use the Rule of 72. Round your answer to 2 decimal places.) Number of years: b. If the inflation rate is 3.5% per year, what will be the change in the purchasing power of your money over this period? (Use the Rule of 72 to compute the number of years. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Purchasing power increases or decreases by %What is the uninflated present worth of a ₱200,000 future value in two years if the average inflation rate is 6% and interest rate is 10%.
- A series of twenty-one constant-dollar payments beginning with $5,000 at the end of the first year are growing at a rate of 4% per year. If the inflation-free rate is 3% per year and the inflation rate is 6% per year, find the present equivalent of this series of payments using constant-dollar analysis. The base year is year 0.A series of four annual constant-dollar payments beginning with $7,000 at the end of the first year is growing at the rate of 8% per year. Assume that the base year is the current year (n=0). If the market interest rate is 13% per year and the general inflation rate is 7% per year, find the present worth of this series of payments on (a) Constant-dollar analysis (b) Actual –dollar analysisConsumer Price Index: At an annual inflation rate of 7.2%, how long will it take the Consumer Price Index (CPI) to double? Thank you.