Answer: How do you give away points?
Answer:
Real Interest Rate = -2.7%
Explanation:
The formula to calculate the Real Interest rate is:

Here,
r = Real Interest Rate
i = Nominal Interest Rate = 3% = 0.03
p = Rate of Inflation
We have the value of Nominal Interest Rate. Before using the formula we need to calculate the Rate of Inflation. We have the values of CPI at the beginning and end of the year. From these we can calculate the Inflation Rate. The formula to calculate the inflation rate is:

Using the values in this formula, we get:

Now we have all the values that we need to use. The values in the formula will be used in decimals, not in percentages. Substituting the values, we get:

Thus, the Real Interest Rate that Juanita earned is -2.7%. This shows that rate of Inflation is more than the Nominal Interest and the value of her savings actually decreased compared to the beginning of the year.
The correct statement is Inflation is problematic if unexpected
Money loses purchasing power during inflation and there's too much of it.
Answer:
Accounting treatment (debit credit rules) of given entries
Explanation:
- Purchased office furniture on account Account
Furniture ie Asset increase - Debit , Creditor (Furniture Supplier) ie Liability increase - Credit
- Provided services on account
Debtor ie Asset increase - Debit , Sale ie Income increase - Credit
Prepaid Expense (Rent) ie Asset Increase - Debit. Rent paid now implies later rent ie (Expense) decrease - Credit