Asked by Jessica

1. Suppose the buying power of the dollar decreases by 6.7% this year. What is the rate of inflation this year?
a) 7.6%
b) 7.2%
c) None of the above.
Answered by Steve
1/(1+r) = 1-.067 = .933
1+r = 1.0718
r = 7.2%
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