Gce Model Questions Vol1 2017 Economics Question 47

Practice objective / multiple choice question 47 from the 2017 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2017 Economics Objective / Multiple Choice Medium Difficulty
Question 47 GCE_MODEL_QUESTIONS_VOL1 • 2017 • ECONOMICS • objective

The Consumer Price Index (CPI) was \(112\) in 2020 and rose to \(118\) in 2021. A savings account offered a nominal interest rate of \(8\%\) per annum throughout the year. A worker's nominal monthly wage increased from \(\text{₦}50{,}000\) in 2020 to \(\text{₦}55{,}000\) in 2021. Calculate (a) the inflation rate between 2020 and 2021, (b) the real interest rate on the savings account, and (c) the percentage change in the worker's real wage over the same period.

Answer Options

Correct Answer A. Inflation ≈ 5.36 %; real interest rate ≈ 2.64 %; real wage increase ≈ 4.64 %
B. Inflation ≈ 6.00 %; real interest rate ≈ 1.00 %; real wage increase ≈ 5.00 %
C. Inflation ≈ 5.36 %; real interest rate ≈ 2.64 %; real wage increase ≈ 3.00 %
D. Inflation ≈ 4.50 %; real interest rate ≈ 3.50 %; real wage increase ≈ 3.50 %
Correct Answer
A
Correct Option:
Inflation ≈ 5.36 %; real interest rate ≈ 2.64 %; real wage increase ≈ 4.64 %

About This Question

This is Gce Model Questions Vol1 2017 Economics Question 47. It is one of the objective questions from the 2017 Gce Model Questions Vol1 Economics examination.

Difficulty level: Medium .

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