Purchasing power is the value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. A rate of return is the annual percentage return realized on an investment, which is adjusted for changes in prices due to inflation or other external effects. Given: Rate of return = 3%Rate of inflation =3% Buying Power = 3% - 3% = 0% Thus, the buying power will remain same for the year.
