Answer:
(a) $3,444,444.44
(b) $11,160,000
Explanation:
(a) Effective purchasing power:
= Loan amount ÷ (1 + cumulative inflation rate)
= $6,200,000 ÷ (1 + 0.80)
= $6,200,000 ÷ 1.80
= $3,444,444.44
Therefore, the effective purchasing power of the $6,200,000 is $3,444,444.
(b) Lender should be repaid:
= Loan amount × (1 + cumulative inflation rate)
= $6,200,000 × (1 + 0.80)
= $6,200,000 × 1.80
= $11,160,000
Answer:
Going to college has an opportunity cost of not working or working less. Buying a car has an opportunity cost of not being able to save as much. Buying a house could have an opportunity cost of not being able to travel. Opportunity cost is the choice you give up when selecting something else.
Explanation:
D a basic need for a constant supply of the item.
<span>economics. This is the correct answer because economics deals with how money and interest rates are tied to political, social, and corporate decisions. In this situation interest rates (money) of cars are houses are influenced by the fed (the government) which explains why this is an economics question.</span>
Answer:
D) per capita GDP decreased for country A only
Explanation:
Per capita GDP is calculated by dividing total GDP by the total population of the country. If the population of the country grows faster than its GDP, then its GDP per capita will decrease.
For example, country A's GDP is $100, and it has 20 citizens, so its GDP per capita for year 1 = $100 / 20 = $5. If the economy grew by 4% and the population grew by 5%, then the GDP per capita on year 2 will = $104 / 21 = $4.95.
