Question

During a certain year, the consumer price index increased from 120 to 132 and the purchasing power of a persons bank account increased by 4 percent. for that year,
a. the nominal interest rate was 14 percent.

b. the inflation rate was 9 percent.

c. the nominal interest rate was 6 percent.

d. the inflation rate was 12 percent

Answer 1

The answer is D.} the inflation rate was 12 percent.