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Q: real interest rate
A: Formula for Real Interest Rate: Real Interest Rate = Nominal Interest Rate - Inflation Rate
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- A loan has an interest rate of 8%, and the inflation rate is 2.4%. What is the loan’s real interest rate adjusted for inflation?The effective interest rate on a mortgage with monthly payments is 9.38%. What is the monthly interest rate on the mortgage? What is the nominal interest rate?Waleed is lending Emad $1,000 for one year. The CPI is 1.40 at the time the loan is made. They expect it to be 1.54 in one year. If Waleed and Emad agree that Waleed should earn a 6% real return for the year, what is the nominal interest rate?
- Find the real interest rate prevailing if inflation is 2% and Nominal Interest rate is 3 times the inflation rateSam bought a rental property for 500,000 five years ago. He sold the property this year for $2,200,000 and spent $343,335 fixing it up before selling the property. If the inflation rate for the past 5 years has been steady at 5% annually. a. What is the actual interest rate of this investment? b. What is the real interest rate Sam earned?If the real interest rate is 8% and inflation is 4% Calculate the nominal interest rate.
- The CPI fell from 110 at the start of the year to 125 at the end of the year. If the real interest rate is 7.9%, then what is the nominal interest rate?If the inflation rate is 12% and the CPI for 2019 is 250 Calculate the CPI for 2020Calculate real interest rate if Nominal Interest rate is 8.2% and inflation is 6.1%
- Suppose you put $1000 into a savings account for 5 years and were paid $10 every quarter. The nominal interest rate is:What is the value of inflation when real interest rate is 6% and the nominal interest rate is also 6%Suppose a house that was worth $68,000 in 1987 is worth $104,000 in 2004. Assuming a constant rate of inflation from 1987 to 2004, what is the inflation rate?