The table below shows the annual rate of inflation for an economy over a four-year period:
YearAnnual Rate of Inflation (%)1+4.02+1.53−2.04+3.5 \begin{array}{|c|c|} \hline \text{Year} & \text{Annual Rate of Inflation (\%)} \\ \hline 1 & +4.0 \\ \hline 2 & +1.5 \\ \hline 3 & -2.0 \\ \hline 4 & +3.5 \\ \hline \end{array} Year1234Annual Rate of Inflation (%)+4.0+1.5−2.0+3.5Which of the following statements is correct?
The general price level was lower in Year 2 than in Year 1.
The purchasing power of money was higher in Year 3 than in Year 2.
The general price level was at its highest in Year 2.
The purchasing power of money rose in Year 4 compared to Year 3.
