Business, 04.03.2022 14:00 kaylam5599

Initially, Poornima earns a salary of $400 per year and Manuel earns a salary of $200 per year. Poornima lends Manuel $100 for one year at an annual interest rate of 10% with the expectation that the rate of inflation will be 5% during the one-year life of the loan. At the end of the year, Manuel makes good on the loan by paying Poornima $110. Consider how the loan repayment affects Poornima and Manuel under the following scenarios. Suppose all prices and salaries rise by 10% (as expected) over the course of the year. In the following table, find Frances's and Dmitri's new salaries after the 10% increase, and then calculate the $224 payment as a percentage of their new salaries.

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Initially, Poornima earns a salary of $400 per year and Manuel earns a salary of $200 per year. Poor...

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