Business, 16.03.2020 20:48 poonwagon994

Suppose Kyoko is an avid reader and buys only mystery novels. Kyoko deposits $3,000 in a bank account that pays an annual nominal interest rate of 10%. Assume this interest rate is fixed—that is, it won't change over time. At the time of her deposit, a mystery novel is priced at $15.00.

Initially, the purchasing power of Kyoko's $3,000 deposit ismystery novels.

For each of the annual inflation rates given in the following table, first determine the new price of a mystery novel, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Kyoko's deposit after one year in the first row of the table for each inflation rate. Finally, enter the value for the real interest rate at each of the given inflation rates.

Hint: Round your answers in the first row down to the nearest mystery novel. For example, if you find that the deposit will cover 20.7 mystery novels, you would round the purchasing power down to 20 mystery novels under the assumption that Kyoko will not buy seven-tenths of a mystery novel.

Annual Inflation Rate

0% 10% 13%
Number of Novels Kyoko Can Purchase after One Year
Real Interest Rate
When the rate of inflation is equal to the interest rate on Kyoko's deposit, the purchasing power of her deposit over the course of the year.

Answers: 2

Show answers

Another question on Business

Business, 21.06.2019 18:10

Panera bread is a chain of cafes serving sandwiches, soups, and freshly baked breads. the company began in 1981 with stores primarily located along the east coast of the united states. since then, the firm has expanded to over 1,300 locations throughout the united states and canada. the firm has strong earnings and has been designated by business week as a "significant growth company." panera bread executives are considering the idea of expanding globally by opening cafes in asia through a franchising strategy. which of the following, if true, supports the argument that panera bread should expand into asia through franchising? a: the panera bread menu changes rapidly, and each cafe's artisan bread bakers receive regular training on new recipes. b: panera bread executives want fast access to the asian market without a significant investment of capital. c: panera bread executives want to test the asian market with a short-term commitment that allows them to make quick profits. d: the panera bread mission is to make excellent bread available to customers around the world.

Answers: 2

Answer

Business, 22.06.2019 09:50

Beck company had the following accounts and balances at the end of the year. what is net income or net loss for the year? cash $ 74 comma 000 accounts payable $12,000 common stock $21,000 dividends $12,000 operating expenses $ 13 comma 000 accounts receivable $ 49 comma 000 inventory $ 47 comma 000 longminusterm notes payable $33,000 revenues $ 91 comma 000 salaries payable $ 30 comma 000

Answers: 1

Answer

Business, 22.06.2019 11:50

Which of the following does not offer an opportunity for timely content? evergreen content news alerts content that suits seasonal consumption patterns content that matches a situational trigger content that addresses urgent pain points

Answers: 2

Answer

Business, 22.06.2019 12:10

Gwen, a manager at exude apparels inc., received a message from a customer requesting a replacement for a purchased pair of shoes. exude apparels has a clearly stated no-return policy. gwen responded to the customer denying the request in a tactful and clear manner. despite this, the customer submitted a second request. in this scenario, which of the following is an appropriate response to the second request?

Answers: 2

Answer

You know the right answer?

Suppose Kyoko is an avid reader and buys only mystery novels. Kyoko deposits $3,000 in a bank accoun...

Questions