Answer:
Option B.More than, is the correct option.
Step-by-step explanation:
If purchasing power in 1970 was $50000 and we have to calculate the purchasing power in 2007.
During this period of 37 years change in inflation rate was 4.46% so the purchasing power of $50000 will become
[tex]P=P_{0}(1+\frac{r}{100})^{t}[/tex]
[tex]P=50000(1+\frac{4.46}{100})^{37}[/tex]
[tex]P=50000(1.0446)^{37}=50000.(5.025)[/tex]
P = $251258
Which is very high as compared to $200000.
Therefore purchasing power in 1970 was more than in 2007.
Option B.is the correct option.
