Question

select the correct answer.

which scenario reflects an annual inflation rate of 3%?

in year 1, the price of a computer is $325.00. in year 2, the same computer costs $328.00.
in year 1, the price of a soda is $0.75. in year 2, the same soda costs $0.78.
in year 1, the price of a board game is $10.00. in year 2, the same board game costs $10.03.
in year 1, the price of a sofa is $500.00. in year 2, the same sofa costs $515.00.

Explanation:

Define the inflation rate formula

$$ \text{Inflation Rate} = \frac{\text{Price in Year 2} - \text{Price in Year 1}}{\text{Price in Year 1}} \times 100\% $$

Calculate the rate for each scenario

$$
LATEXBLOCK0
$$

Identify the correct scenario

$$ \text{Scenario 4 matches the required } 3\% \text{ annual inflation rate.} $$

Answer:

• (A) In year 1, the price of a computer is $325.00. In year 2, the same computer costs $328.00.
• (B) In year 1, the price of a soda is $0.75. In year 2, the same soda costs $0.78.
• (C) In year 1, the price of a board game is $10.00. In year 2, the same board game costs $10.03.
• (D) In year 1, the price of a sofa is $500.00. In year 2, the same sofa costs $515.00. (Correct answer)