You borrow $50,000 today at a rate of 5%. Today, inflation instantly rises to 7% and stays that way for the duration of your loan. Based on the above information today O you will pay the lender back exactly $55,500. O you will pay the lender back exactly $60,700. the real rate of interest on your loan is 10% the real rate of interest on your loan is-2% the real rate of interest on your loan is 2%
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- Suppose Dalia is a sports fan and buys only football tickets. Dalia deposits $4,000 into a savings account that pays an annual nominal interest rate of 5%. Assume this interest rate is fixed, and so it will not change over time. On the day she makes her deposit, suppose that a football ticket has a price of $10.00. Initially, Dalia's $4,000 deposit has a purchasing power of football tickets. For each of the annual inflation rates given in the following table, first determine the new price of a football ticket, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Dalla'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 football ticket. For example, if you find that the deposit will cover 20.7 football tickets, you would round the purchasing power down to 20 football…Suppose Dalia is a sports fan and buys only football tickets. Dalia deposits $3,000 into a savings account that pays an annual nominal interest rate of 5%. Assume this interest rate is fixed, and so it will not change over time. On the day she makes her deposit, suppose that a football ticket has a price of $15.00. Initially, Dalia's $3,000 deposit has a purchasing power of football tickets. For each of the annual inflation rates given in the following table, first determine the new price of a football ticket, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Dalia'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 football ticket. For example, if you find that the deposit will cover 20.7 football tickets, you would round the purchasing power down to 20 football…Suppose you have $200,000 in a bank term account. You earn 5% interest perannum from this account.You anticipate that the inflation rate will be 4% during the year. However, theactual inflation rate for the year is 6%.Calculate the impact of inflation on the bank term deposit you have andexamine the effects of inflation in your city of residence with attention to foodand accommodation expenses.2. The Australian Bureau of Statistics (ABS) reported in May 2017 that the civilianpopulation in Australia over 15 years of age was 20.8 million.Of this population of 20.8 million Australians, 13.5 million were employed and0.7 million were unemployed.Calculate Australia’s labor force and the number of people in the civilianpopulation who were not in the labor force? Also,
- Suppose Dalia is a sports fan and buys only football tickets. Dalia deposits $2,000 into a savings account that pays an annual nominal interest rate of 20%. Assume this interest rate is fixed, and so it will not change over time. On the day she makes her deposit, suppose that a football ticket has a price of $20.00. Initially, Dalia's $2,000 deposit has a purchasing power of football tickets. For each of the annual inflation rates given in the following table, first determine the new price of a football ticket, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Dalia'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 football ticket. For example, if you find that the deposit will cover 20.7 football tickets, you would round the purchasing power down to 20 football…Suppose Damaris is a sports fan and buys only football tickets. Damaris deposits $3,000 into a savings account that pays an annual nominal interest rate of 5%. Assume this interest rate is fixed, and so it will not change over time. On the day she makes her deposit, suppose that a football ticket has a price of $15.00. Initially, Damaris's $3,000 deposit has a purchasing power of football tickets. For each of the annual inflation rates given in the following table, first determine the new price of a football ticket, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Damaris'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 football ticket. For example, if you find that the deposit will cover 20.7 football tickets, you would round the purchasing power down to 20…Suppose Damaris is a sports fan and buys only football tickets. Damaris deposits $2,000 into a savings account that pays an annual nominal interest rate of 10%. Assume this interest rate is fixed, and so it will not change over time. On the day she makes her deposit, suppose that a football ticket has a price of $10.00. Initially, Damaris's $2,000 deposit has a purchasing power of football tickets. For each of the annual inflation rates given in the following table, first determine the new price of a football ticket, assuming it rises at the rate of inflation. Then enter the corresponding purchasing power of Damaris'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 football ticket. For example, if you find that the deposit cover 20.7 football tickets, you would round the purchasing power down to 20 football…
- Suppose you lent money to a friend a few years ago at a nominal interest rate of 6%. At the time ot he loan, you expected the annual inflation rate to be 2%, but the actual annual inflation rate was 1.2%. When the loan originated, you expected to earn a real return of but due to unexpected disinflation, you earned an actual real return of A. 2%; 1.2% OB. 4.8%; 6% C. 6%; 4.8% D. 4%; 4.8%6. Interest, inflation , and purchasing power Suppose Caroline is a sports fan and buys only baseball caps. Caroline deposits 2000 in a bank account that pays an annual nominal interest rate of 15%. Assume this interest rate is fixed-that is, it won't change over time. At the time of her deposit {comma} a baseball cap is priced at $20. Initially, the purchasing power of Caroline's 2000 deposit is baseball caps. For each of the annual inflationrates given in the following table, first determine the new price of a baseball cap, assuming it rises at the rate of inflation.then enter the corresponding purchasing of Caroline'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:Brown your answers in the first row down to the nearest baseball cap. For example, if you find that the deposit will cover 20.7 baseball caps, you would round to the purchasing power down…Your rich aunt is going to give you an end-of-year gift of $1,000 for each of the next 10 years. Solve, a. If general price inflation is expected to average 6% per year during the next 10 years, what is the equivalent value of these gifts at the present time? The real interest rate is 4% per year. b. Suppose that your aunt specified that the annual gifts of $1,000 are to be increased by 6% each year to keep pace with inflation. With a real interest rate of 4% per year, what is the current PW of the gifts?
- Suppose you start saving for retirement when you are 31 years old. You invest $5,200 the first year and increase this amount by 4% each year to match inflation for a total of 25 years. The interest rate is 9% per year. 1. How much will you have in account immediately after making the last deposit at age 55 OA. $1,174,047 OB. $71,848 OC. $578,420 O D. $619,553 www 2. How much will you have, if the interest rate was only 4% per year (instead of 9%)? OA. $125,000 B. $303,117 OC. $333,230 OD. $346,559Suppose you have $200,000 in a bank term account. You earn 5% interest perannum from this account.You anticipate that the inflation rate will be 4% during the year. However, theactual inflation rate for the year is 6%.Calculate the impact of inflation on the bank term deposit you have andexamine the effects of inflation inWhat is the inflation rate in 2019? Has it increased or decreased since 2018 and by how much? If the nominal interest rate in 2019 is 7%, what would be the change in purchasing power of $1,000 deposited in January 219 by the end of the year? Please explain if it has increase or decreased since 2018 and by how much? also what if inflation rate was higher then purchasing power?