One share of Tesla stock has increased in value from $61/share in February 2019 to $941 in February 2022. Suppose instead that an investor had taken her $61 and deposited it in a bank for three years. What bank interest rate would be required to earn the same profit as the investment in the Tesla stock? Ignore the effects of inflation in this problem. An interest rate should be expressed as a percentage with two decimal places. For example, 0.04635 should be entered as 4.64.

One share of Tesla stock has increased in value from $61/share in February 2019 to $941 in February 2022. Suppose instead that an investor had taken her $61 and deposited it in a bank for three years. What bank interest rate would be required to earn the same profit as the investment in the Tesla stock? Ignore the effects of inflation in this problem. An interest rate should be expressed as a percentage with two decimal places. For example, 0.04635 should be entered as 4.64.

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter6: How Statisticians Measure Inflation

Section: Chapter Questions

Problem 6TY

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