Answered: Imagine you borrow $1,200 from your…

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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Imagine you borrow $1,200 from your roommate, agreeing to pay her back $1,200 plus 10 percent nominal interest in one year. Assume inflation over the life of the contract is expected to be 5.48 percent. What is the total dollar amount you will have to pay her back in a year? What approximate percentage of the interest payment is the result of the real rate of interest? Use the simplified Fisher equation. (Do not round intermediate calculations. Round answers to 2 decimal places, e.g. 17.54.)

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Total dollar amount		$enter a dollar amount rounded to 2 decimal places
Approximate percentage of interest attributable to the real rate of interest		enter percentages rounded to 2 decimal places %