If the Consumer Price Index Was 170 in One Year

question 175

Multiple Choice

If the Consumer Price Index was 170 in one year and 180 in the next year, then the rate of inflation was approximately

• A)5.5 percent.
• B)5.9 percent.
• C)6.3 percent.
• D)7.2 percent.

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Definitions:

Equity

The ownership interest in a company, represented by the amount of money that would be returned to shareholders after paying off all liabilities.

Option Premium

The price paid by the buyer of an options contract to the seller, representing the cost of acquiring the option.

Exercise Price

The price at which the holder of an option can purchase (or sell) the underlying security, such as a stock.

Net Profit

The amount of money left over from revenues after all expenses have been deducted, representing the actual profit of a business.