Answered: Suppose that the Consumer Price Index…

Suppose that the Consumer Price Index increased by 9% over this period. What happened to the real price of Internet service? The real price of Internet service decreased by:

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 2P

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Concept explainers

Stock Market Indices

Stock indexes are used to compare the price fluctuations of a group of stocks of similar companies, which are combined based on a similar industry or a particular market capitalization limit or type of market. The price comparison is based on a pre-determined standard method or indicators. These stock indexes are usually considered a base for comparison of a particular stock, and the performance of that particular company can be easily determined.

Question

13 of 38
The price of high speed Internet service fell from 40 cents per minute in 2004 to
22 cents per minute in 2010, a 45-percent (18 cents/40 cents) decrease.
Suppose that the Consumer Price Index increased by 9% over this period. What
happened to the real price of Internet service? The real price of Internet service
decreased by:
O A. 25.6%
O B. 36.0%
O C. 49.5%
O D. 50.5%
Unsure

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