question archive The nominal interest rate of an investment is 15%
The nominal interest rate of an investment is 15%
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The nominal interest rate of an investment is 15%. Inflation is 10.1%. What is the real rate of interest of this investment? (5 pts)
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Nominal Interest rate = Real Interest Rate + Inflation Rate
15% = Real Interest Rate + 10.1%
15% - 10.1% = Real Interest Rate
4.9% = Real Interest Rate
The Real Interest Rate is 4.9%.
