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Inflation Assuming annual compounding, find the time it

Chapter 2, Problem 75A

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QUESTION:

Problem 75A

Inflation Assuming annual compounding, find the time it would take for the general level of prices in the economy to double at the following annual inflation rates.

a. 3%

b. 6%

c. 8%

d. Check your answers using either the rule of 70 or the rule of 72, whichever applies.

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QUESTION:

Problem 75A

Inflation Assuming annual compounding, find the time it would take for the general level of prices in the economy to double at the following annual inflation rates.

a. 3%

b. 6%

c. 8%

d. Check your answers using either the rule of 70 or the rule of 72, whichever applies.

ANSWER:

SOLUTION:

Step 1 of 3:

In this question, assuming annual compounding, find the time it would take for the general level of prices in the economy to double at the following annual inflation rates. (a) 3% (b)  6% (c)  8% (d) Check the answers using either the rule of 70 or the rule of 72, whichever applies.

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