Question

Babe Ruth signed a contract on March 10, 1930 with the American League Base Ball Club of New York (The Yankees) to play baseball for the next two years at an annual salary of $80,000. In 2012 the CPI was 15 times larger than it was in 1931. What amount of money in 2012 would have the same purchasing power as Babe Ruth’s $80,000 contract in 1930?

A. $80,000 compounded at the rate of 5% B. $1,500,000 C. $2,200,000 D. cannot be calculated based on the information given E. $1,200,000

Deposits at Bank A pay an interest rate of 8.8%. Deposits at Bank B pay an interest rate of 9.15%.

The difference between the two interest rates is

A. 0.035 basis points B. 0.35 basis points C. 3.5 basis points D. 35 basis points E. 350 basis points

The inflation rate is 3.4% and the unemployment rate is 2.5%. What is the misery index for that economy? (a) -5.9%. (b) -0.9%. (c) 5.9%. (d) 0.9%.

Answer 1