Over the last 10 years, the average rate of inflation has been 1.51%. What is the purchasing power of a dollar today in terms of what a peso could purchase in 2012?
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Q: Over the last 10 years, the average rate of inflation has been 1.51%. What is the purchasing power…
A: The average annual inflation rate over the past 10 years was 1.51%
Over the last 10 years, the average rate of inflation has been 1.51%. What is the
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- Over the last 10 years, the average rate of inflation has been 1.61%. what is the purchasing power of a dollar today in terms of what a dollar could purchase in 2008?What is the value of year 4's output in nominal dollars?Suppose the GDP of Honduras is 100,000 lempiras and the exchange rate between Honduran currency lempiras and USD is 20 lempira=$1. What is the GDP of Honduras when measured in USD?
- A South American country has had a high rate of inflation. Recently, its exchange rate was 15 lunas per dollar. It is likely that the country will continue to experience a 25% inflation rate and that the US will continue at a 3% inflation rate. Assume that the exchange rate will vary the same as the inflation. In this situation, one dollar will buy how many lunas FIVE years from now? 39.40 lunas 30.14 lunas 45.78 lunas $42.56 lunasSuppose Australia has an annual 6% inflation rate, while the annual growth rate of the nominalexchange rate, expressed in euros per Australian dollar, is 4%. If purchasing power parity holds,what is the annual inflation rate in the Eurozone?In the last 4 years, the exchange rate Pound to Euro depreciated (decreased) to an average of 1.13 (from 1.30 before 2016). When citizens from the UK would go on holidays in a Euro zone country (e.g. Spain), would a lower exchange rate of 1.13(Sterling Pound to Euro) instead of an exchange rate of 1.30 (Pound to Euro) be of advantage or disadvantage for British tourists in Europe? Explain.
- What is the growth in year 2009 currency of 7,400 paid for an item in 2009 that now in 2020 costs 10,200 given the baseline index in 2009 was 218.5 and the equivalent index in 2020 is 256.5?Search for the “World Economic Outlook Database” on the internet and locate the most recent version. Use this database to select inflation data (units of percentage change) for Germany, Japan, and the United States for the period 1990 to 2010. Construct a table of annual inflation rates for these countries. Now construct a graph using annual inflation rates on the vertical axis and the year on the horizontal axis. Plot the annual inflation rates from your table in three separate lines on the same graph. How would you compare the experiences of these three countries based on your graph?Suppose we consider two countries, a home country and a foreign country. In the home country, the expected inflation rate is equal to 3.6 per cent, while the expected inflation rate abroad is equal to 4.2 per cent. Furthermore, it is known that the nominal interest rate in the home country is equal to 3.4 per cent, while the nominal interest rate abroad is equal to 4 per cent.a) First explain what is meant by absolute purchasing power parity, relative purchasing power parity and uncovered nominal interest rate parity. Then give an estimate of the expected growth in the nominal exchange rate based on each of the three theories. Finally, show that if both relative purchasing power parity and uncovered nominal interest rate parity apply, real interest rates in the two countries will be approximately equal.
- The spot rate of foreign exchange between Thailand and the United States (USA) is ฿30.7/$. The exchange rate is expected to grow by 7% over the next year. How can you describe the inflation rates, the nominal interest rates and the real rates in the USA versus Thailand?Hyperinflation has struck your country! Over the past year the price of a loaf of bread has increased from $2 to $52,858. What is the annual rate of inflation suggested by this increase? Put your answer in percentage form (e.g. 30.57 not 0.3057) and then round to two decimal places.Assume "this year" is the base year used in calculating the CPI. Over the next year, the inflation rate will be 9.3%, while the nominal interest rate is 1.2% per year. What is the real value of $2,000 received one year from now? (That is, what amount of money now gives you the same purchasing power as $2,000 in one year.) Do not write the dollar ($) sign, and use a minus (-) in front of a decrease. Round your answer to one (1) decimal.