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A bicycle tire company performed a web-based study of a popular tire retail price over time. The study indicated that price is set at $19.00
A bicycle tire company performed a web-based study of a popular tire retail price over time. The study indicated that price is set at $19.00 per tire, it was expected to increase to $26.00 over the next 5 years. a. Determine the annual rate of inflation over 5 years to increase the price from $19.00 to $26.00. b. Determine the market interest rate that must be used in economic equivalence computations if inflation is considered and a 6% per year real interest rate is expected by this company
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