(Inflation and interest rates) Assume the expected inflation rate is 3.8 percent. If the current real rate of interest is 8.7 percent, what should the nominal rate of interest be? The nominal rate of interest should be %. (Round to two decimal places.) (Related to Checkpoint 9.6) (Inflation and interest rates) What would you expect the nominal rate of interest to be if the real rate is 3.9 percent and the expected inflation rate is 7.4 percent? The nominal rate of interest would be %. (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
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(Inflation and interest rates) Assume the expected inflation rate is 3.8 percent. If the current real rate of interest is 8.7 percent, what should the nominal rate of interest be?
The nominal rate of interest should be %. (Round to two decimal places.)
Transcribed Image Text:(Inflation and interest rates) Assume the expected inflation rate is 3.8 percent. If the current real rate of interest is 8.7 percent, what should the nominal rate of interest be? The nominal rate of interest should be %. (Round to two decimal places.)
(Related to Checkpoint 9.6) (Inflation and interest rates) What would you expect the nominal rate of interest to be if the real rate is 3.9 percent and the expected inflation rate is 7.4 percent?
The nominal rate of interest would be %. (Round to two decimal places.)
(-)
Transcribed Image Text:(Related to Checkpoint 9.6) (Inflation and interest rates) What would you expect the nominal rate of interest to be if the real rate is 3.9 percent and the expected inflation rate is 7.4 percent? The nominal rate of interest would be %. (Round to two decimal places.) (-)
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