##### Determine the average inflation rate for this commodity
Decide the typical inflation fee for this commodity 1. For a sure commodity, costs improve by 50% the primary 12 months and 30% the second 12 months. Decide the typical inflation fee for this commodity over this two-year interval. a) 80.zero% b) 40.5% c) 39.6% d) 40.zero% 2. The CPI for 1995 was 152.four and for 2010 it was 218.1. What was the typical common inflation fee throughout these years? a) 2.42% b) 2.59% c) three.18% d) 2.27% three. To calculate the NPW (at 12 months zero) of N annual money flows of \$1000 fixed (ranging from 12 months 1), which of the next equations is/are appropriate? (i: market rate of interest, f: inflation fee, i': inflation-free rate of interest) a) NPW = \$1000 × (P/A, i', N) -- use the equal fee collection current price issue b) NPW = \$1000 × (P/A1, f, i, N) -- use the geometric gradient collection current price issue c) Each (a) and (b) are appropriate d) Neither (a) nor (b) is appropriate four. Engler Company manufactures specialised blades. Final 12 months the corporate manufactured and offered 40,000 blades. Gross sales are down this 12 months to an estimated 35,000 items, nevertheless the corporate is unable to lowered its mounted prices from the prior 12 months. Its complete estimated value for the 40,000 items it made final 12 months is as follows: Direct Materials (variable) \$375,000 Direct Labor (variable) \$250,000 Manufacturing Overhead Variable portion \$75,000 Mounted portion \$90,000 Promoting and Administrative Variable portion \$55,000 Mounted portion \$45,000 What's the break-even worth for the blades this 12 months (given a manufacturing forecast of 35,000 blades)? a) \$29.67 b) \$29.04 c) \$22.73 d) \$25.17