In the Country of Hyrkania,the CPI in 2012 Was 140

question 3

Multiple Choice

In the country of Hyrkania,the CPI in 2012 was 140 and the CPI in 2013 was 154.Jake,a resident of Hyrkania,borrowed money in 2012 and repaid the loan in 2013.If the nominal interest rate on the loan was 14 percent,what was the real interest rate?

• A)18 percent
• B)14 percent
• C)10 percent
• D)4 percent

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Definitions:

Donated Land

This informs the recording of land gifted to an entity, valued at its fair market value at the time of donation as an asset on the balance sheet.

Donated Machinery

Assets received for free by an entity, where the fair market value of the machinery is recorded as both income and an asset on the balance sheet.

Volunteer Hours

The amount of time individuals spend performing unpaid services for nonprofit organizations or community projects.

Restricted Fund Method

An accounting practice where funds specified for certain purposes are kept separate in financial records to ensure their use only for those purposes.