If the inflation rate is 5 percent and the real interest rate is 2.5 percent, then the nominal interest rate is
A) 10 percent. B) -2.5 percent. C) 2.5 percent. D) 7.5 percent. E) 2 percent.
Question 2
An example of the outlet substitution bias in the calculation of the CPI is a price increase in
A) a trip to Mexico for a couple that had previously taken vacations in Europe.
B) a 2014 Honda Civic relative to a 2004 Honda Civic.
C) GPS units versus AAA map books.
D) textbooks bought through the campus bookstore relative to textbooks via Craigslist.
E) olive oil versus vegetable oil.
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Average real hourly wages (2010 dollars) by education level, full-time workers aged 17 to 34 in 2011
Cost = $99.49; Rate of markup based on cost = 32%. Find the markup and selling price.