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Evaluate the change in costs over the period in real terms

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1. Suppose industry abatement costs rise from $850 million in 2011 to $1,000 million in 2012 in nom- inal terms and that the CPI is 100 in 2011 and 106 in 2012.

a. Evaluate the change in costs over the period in real terms, first in 2011 dollars and then in 2012 dollars.

b. Are your answers the same? Explain why or why not.

Reference no: EM13914567

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