rorostar10p8wi2c
Answered

Westonci.ca is the ultimate Q&A platform, offering detailed and reliable answers from a knowledgeable community. Join our platform to connect with experts ready to provide detailed answers to your questions in various areas. Get precise and detailed answers to your questions from a knowledgeable community of experts on our Q&A platform.

From 1929 through the early 1930s, the prices of consumer goods actually decreased. Economists call this phenomenon deflation. The rate of deflation during this period was about 7% per year, meaning that prices decreased by 7% per year. To get a sense of what this rate would mean in the long run, let's suppose that this rate of deflation persisted over a period of 20 years.

What would be the cost after 20 years of an item that costs $400 initially? (Round your answer to the nearest cent.)
$ ______

Sagot :

sqdancefan

9514 1404 393

Answer:

  $93.70

Step-by-step explanation:

The multiplier each year would be (1 -7%) = 0.93. After 20 years, the price would be multiplied by this value 20 times:

  cost = $400 × 0.93^20 ≈ $93.70

After 20 years of 7% deflation, the cost would be $93.70.

Thank you for choosing our service. We're dedicated to providing the best answers for all your questions. Visit us again. Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. We're glad you visited Westonci.ca. Return anytime for updated answers from our knowledgeable team.