Suppose That Over the Past Year,the Real Interest Rate Was

question 109

Multiple Choice

Suppose that over the past year,the real interest rate was 3 percent,the CPI was 126.2 at the beginning of the year,and the CPI was 129.5 at the end of the year.It follows that

• A)the dollar value of savings increased at 5.6 percent,and the purchasing power of savings increased at 3 percent.
• B)the dollar value of savings increased at 0.4 percent,and the purchasing power of savings increased at 3 percent.
• C)the dollar value of savings increased at 3 percent,and the purchasing power of savings increased at 5.6 percent.
• D)the dollar value of savings increased at 3 percent,and the purchasing power of savings increased at 0.4 percent.