If the rate of inflation is 5.53%, what nominal interest rate is necessary for you to earn a 2.38% real interest rate on your investment? (Note: Be careful not to round any intermediate steps less than six decimal places.) The nominal interest rate needed for your investment is %. (Round to two decimal places.)
If the rate of inflation is 5.53%, what nominal interest rate is necessary for you to earn a 2.38% real interest rate on your investment? (Note: Be careful not to round any intermediate steps less than six decimal places.) The nominal interest rate needed for your investment is %. (Round to two decimal places.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:If the rate of inflation is 5.53%, what nominal interest rate is necessary for you to earn a 2.38% real interest rate on your
investment? (Note: Be careful not to round any intermediate steps less than six decimal places.)
The nominal interest rate needed for your investment is
%. (Round to two decimal places.)
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