Ask Question
22 October, 10:45

Suppose you were borrowing money to buy a car. Consider the following situations. Situation 1: Suppose the interest rate on your car loan is 18.0018.00 percent and the inflation rate is 17.0017.00 percent. Calculate the real interest rate. nothing %. (Enter your response as a percentage rounded to two decimal places.)

+2
Answers (1)
  1. 22 October, 14:01
    0
    1.00%

    Explanation:

    Given that

    Interest rate = 18.00%

    Inflation rate = 17.00%

    Recall that

    Real interest rate = interest rate (nominal) - inflation rate

    Therefore,

    Real interest rate = 18.00 - 17.00

    = 1.00%
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Suppose you were borrowing money to buy a car. Consider the following situations. Situation 1: Suppose the interest rate on your car loan ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers