What is the nominal price of an apple in 10 years if the real price is...
What is the nominal price of an apple in 10 years if the real price is 1$, and the inflation rate is 3%?
A. $0.74
B. $1.34
C. $1.06
D. $1.00
Homework Answers
The nominal price of an apple in 10 years if the real price is 1$, and the inflation rate is 3% is:
- (B.) $1.34
Explanation
We have,
Inflation Rate ( r ) = 0.03 or 3% and Time Years ( t ) = 10
Now we use the following formula to calculate, the nominal price of an apple in 10 years if the real price is 1$, and the inflation rate is 3% .
Therefore, $1.34 is the nominal price of an apple in 10 years if the real price is 1$, and the inflation rate is 3%.
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