Over the Past Year You Earned a Nominal Rate of Interest

question 29

Multiple Choice

Over the past year you earned a nominal rate of interest of 14 percent on your money.The inflation rate was 2 percent over the same period.The exact actual growth rate of your purchasing power was

• A)11.76%.
• B)16.00%.
• C)15.02%.
• D)14.32%.
• E)none of the above.

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Definitions:

Reversal Of Write Downs

The process by which a previously recognized impairment loss on an asset is reversed, often because the reasons for the impairment have ceased, leading to an increase in the asset's carrying amount.

Net Realisable Value

The estimated selling price of goods, minus the costs of their sale or completion.

Write Down Reversal

The process of reversing a previously recorded write down, often due to an increase in the asset's value or a correction of the original value assessed.

Disclosure Requirements

These are mandates that entities must follow when revealing financial and other significant information in their reports, aimed at ensuring transparency and facilitating informed decision-making by users of financial statements.