In a Particular Year,the Interest Rate Is 5% and the Real

question 63

Multiple Choice

In a particular year,the interest rate is 5% and the real rate of return is 3%.What is the rate of inflation for the same year?

• A)2.06%
• B)2.00%
• C)1.94%
• D)1.85%

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Definitions:

Merchandise

Goods that are bought and sold in any business, particularly in retail.

Freight Charge

The cost incurred for transporting goods between places, typically charged by carriers for shipments.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue; also known as net earnings or net profit.

Sales Discounts

Reductions in the price of a product or service offered to incentivize prompt payment by the customer.