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Suppose You Put $100 in the Bank on January 1

Question 53

Multiple Choice

Suppose you put $100 in the bank on January 1, 2017. If the annual nominal interest rate is 5 percent and the inflation rate is 2 percent, you will be able to buy ________ worth of goods on January 1, 2018, valued at 2017's prices.


A) $93
B) $107
C) $103
D) $105
E) $99

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