Suppose That Over the Past Year,the Real Interest Rate Was

question 109

Multiple Choice

Suppose that over the past year,the real interest rate was 3 percent,the CPI was 126.2 at the beginning of the year,and the CPI was 129.5 at the end of the year.It follows that

• A)the dollar value of savings increased at 5.6 percent,and the purchasing power of savings increased at 3 percent.
• B)the dollar value of savings increased at 0.4 percent,and the purchasing power of savings increased at 3 percent.
• C)the dollar value of savings increased at 3 percent,and the purchasing power of savings increased at 5.6 percent.
• D)the dollar value of savings increased at 3 percent,and the purchasing power of savings increased at 0.4 percent.

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Definitions:

Cash Paid for Wages

The amount of money disbursed by a company to its employees as compensation for labor.

Acquire Land

The action or process of obtaining ownership of land, often for business expansion, development, or investment purposes.