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If the CPI was 106 in 2013 and 116 in 2014, the inflation rate in 2014 was:
(a) 106%;
(b) 116%;
(c) 9.4%;
(d) 16%
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- Find the inflation rate necessary for something to cost exactly twice as much as it did 10 years earlier.According to the College Board, the average in-state tuition and fees at public 4-year colleges and universities increased from $1780 in 1990 to $9650 for the 2016–2017 school year (per full-time equivalent student). Calculate the relative change in public college cost over this time period, and compare it to the overall rate of inflation as measured by the CPI.A country is experiencing an inflation rate of exactly 100 percent per month for 4 months. At the end of 4 months, the price level has increased _____ times in relationship to the initial period.
- If the inflation rate is higher than the interest rate, then A. it is no longer possible to earn any amount from an initial capital. B. only if the inflation is within the same period where interest is less, the investor will not earn. C. the amount invested at present time will be equal to the future amount. D. any annual worth computed at any period n (of N total years) will not be equal to the annual worth at n+1 period. E. None of theseWhen all future cash flows are expressed in constant-value dollars, the rate that should be used to find the present worth is the:a. real MARR.b. inflation rate.c. inflated interest rate.d. inflated MARR.The inflation rate in a Central American country is 6% per year. What real rate of return will an investor make on a $100,000 investment in a copper mine stock that yields an overall internal rate of return of 28% per year?
- If a 3D printer increased in cost at exactly the inflation rate, what was the inflation rate if the printer costs exactly twice as much now as it did 10 years ago?An automobile that cost $24,500 in 2018 had an equivalent model 4 years later that cost $29,250. If the increase is attributed to inflation, what was the average annual rate of inflation?Due to inflation in Australia in December 2019, the price for petrol increased from AUD 1.35 to AUD 1.45. This caused petrol consumption to decrease from 2500 litres to 2450 litres at a 7-Eleven Petrol Station in Sydney. Also, when the price for Hyundai 7.5kW Inverter Split System Air Conditioner (Reverse Cycle) increased from AUD 950.00 to AUD 990.00; demand for these air conditioners fell from 2500 units to 2000 units. Following this condition, answer the questions below.i. Using the mid-point formula calculate the price elasticity of demand for petroland Hyundai 7.5kW Inverter Split System Air Conditioner (Reverse Cycle). ii. Is the price elasticity of demand: elastic, unit elastic or inelastic for eachcommodity (petrol and Hyundai 7.5kW Inverter Split System Air Conditioner (Reverse Cycle)? iii. Suppose the government decides to increase tax for petrol and Hyundai 7.5kWInverter Split System Air Conditioner (Reverse Cycle). Use two diagrams to explain the incidence of the tax…
- Find the annual worth equivalent in actual-dollars from year 1 to 8 of an investment of $28,000 now, if the inflation rate is 5.5% and the inflation-free interest rate is 15% per year.If the market interest rate is 12% per year and the inflation rate is 5% per year, the number of future dollars in year 7 that will be equivalent to $2000 now is best represented by the equation: (a) Future dollar amount = 2000(1 + 0.198)7 (b) Future dollar amount = 2000/(1.198)7 (c) Future dollar amount = 2000(1 + 0.12)7 (d ) Future dollar amount = 2000/(1.07)7A small mechanical consulting company is examining its future cash flow requirements. The president expects to replace office machines and IT equipment at various times over a 6-year planning period. Specifically, the company expects to spend $6000 two years from now, $9000 three years from now, and $5000 six years from now. What is the purchasing power (with respect to today’s dollars) of each expenditure in its respective year, if the inflation rate is 4% per year?