$$\begin{array}{l}
\begin{array} { | c | c | }
\hline \text { Good } & \begin{array} { c }
\text { Price Increase since } \
\text { Last Year }
\end{array} \
\hline \text { Amusement park tickets } & 5.0 \% \
\hline \text { Bowling balls } & 4.2 \% \
\hline \text { Camouflage neckties } & 3.1 \% \
\hline
\end{array}\
\text { Table } 8.1
\end{array}$$ Refer to Table 8.1,which gives hypothetical data on price changes for three goods.If the overall rate of inflation in the economy was 3.5%,what happened to the real price of amusement park tickets?
A) The real price of amusement park tickets rose by 1.5%.
B) The real price of amusement park tickets rose by 8.5%.
C) The real price of amusement park tickets rose by 5.0%
D) The real price of amusement park tickets fell by 1.5%.

Question

$$\begin{array}{l}
\begin{array} { | c | c | } 
\hline \text { Good } & \begin{array} { c } 
\text { Price Increase since } \
\text { Last Year }
\end{array} \
\hline \text { Amusement park tickets } & 5.0 \% \
\hline \text { Bowling balls } & 4.2 \% \
\hline \text { Camouflage neckties } & 3.1 \% \
\hline
\end{array}\
\text { Table } 8.1
\end{array}$$ Refer to Table 8.1,which gives hypothetical data on price changes for three goods.If the overall rate of inflation in the economy was 3.5%,what happened to the real price of amusement park tickets?
A) The real price of amusement park tickets rose by 1.5%.
B) The real price of amusement park tickets rose by 8.5%.
C) The real price of amusement park tickets rose by 5.0%
D) The real price of amusement park tickets fell by 1.5%.

Quizplus · Accepted Answer

The real price of amusement park tickets rose by 1.5% because the nominal increase was 5.0% and the overall inflation rate was 3.5%, so the real increase is 5.0% - 3.5% = 1.5%.