What Simple Discount Rate D Is Equivalent to a Simple

question 29

Multiple Choice

What simple discount rate d is equivalent to a simple interest rate of 8% over a 200-day period?

• A)9.00%
• B)7.66%
• C)8.58%
• D)7.41%

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Definitions:

Government Agency

An organization operated by the government to execute specific functions or provide services to the public.

CPI

The Consumer Price Index, a measure that examines the weighted average of prices of a basket of consumer goods and services, used as an indicator of inflation.

Price Level

An index that measures the average prices of goods and services in an economy over a period of time.

Given Up

The cost of forgoing the next best alternative when making a decision, also known as opportunity cost.