A Farmer Produces the Same Output in 2015 as in 2014.His

question 35

Multiple Choice

A farmer produces the same output in 2015 as in 2014.His input prices increase by 3 percent and so does his product price.Which inflation rate makes the farmer as well off in 2015 as in 2014?

• A) 0 percent
• B) 1 percent
• C) 3 percent
• D) 6 percent

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Definitions:

Principal

The main party involved in a financial transaction or agreement, such as the amount of money borrowed in a loan, or a primary actor in a contract.

Implied Warranty

A legal concept that guarantees that a product or service sold will perform as expected, even if not explicitly promised by the seller.

Authority

The capacity or entitlement to direct actions, decide outcomes, and command adherence.

Sue Estate

The legal action taken against a deceased person's estate to settle debts or disputes.