ECON Lesson 6

# ECON Lesson 6 - 1996-1998—Inflation Rates Decreased...

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Ashlie Michelle Ferguson Enrollment #642885 ECON 2010 Lesson 6 1. 1990-1991 = (136.2 - 130.7)/130.7 = 4.2% 1991-1992 = (140.3 – 136.2)/136.2 = 3.0% 1992-1993 = (144.5 – 140.3)/140.3 = 3.0% 1993-1994 = (148.2 – 144.5)/144.5 = 2.6% 1994-1995 = (152.4 – 148.2)/148.2 = 2.8% 1995-1996 = (156.9 – 152.4)/152.4 = 3.0% 1996-1997 = (160.5 – 156.9)/156.9 = 2.3% 1997-1998 = (163.0 – 160.5)/160.5 = 1.6% 1998-1999 = (166.2 – 163.0)/163.0 = 2.0% 1990-1994—Inflation Rates Decreased 1994-1996—Inflation Rates Increased

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Unformatted text preview: 1996-1998—Inflation Rates Decreased 1998-1999—Inflation Rates Increased 2. a. Inflation Rate = (110 – 100)/100 = 0.10 = 10% (1 st year) = (121 – 110)/110 = 0.10 = 10% (2 nd year) 0.02 = i – 0.10 = 0.12 = 12% b. In order for Frank to be sure and get a real return of 2%, Sara should pay interest of 2% plus the inflation rate for that year. 3. D 4. C 5. B 6. C 7. C 8. B 9. A 10. D 11. C 12. B 13. C 14. E 15. B 16. E 17. C...
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ECON Lesson 6 - 1996-1998—Inflation Rates Decreased...

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