You have chosen to set aside $500 to purchase a new television in one year....
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Finance
You have chosen to set aside $500 to purchase a new television in one year. You are told that the account will earn 7% interest over the year (interest is earned annually, no compounding within the year). You expect that inflation over the course of this year will be 2.7% and that the price of an equivalent TV will increase by this amount as well. Calculate your percentage increase (or decrease) in real purchasing power over the course of the year.
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