Corporate Finance
Corporate Finance
3rd Edition
ISBN: 9780132992473
Author: Jonathan Berk, Peter DeMarzo
Publisher: Prentice Hall
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Chapter 5, Problem 27P
Summary Introduction

To discuss: Whether the nominal interest rate and real interest rate can be negative.

Introduction:

The nominal rate refers to the rate before considering the inflation. Nominal rate may also refer to the published or declared interest rate on a loan, without considering any fees.

A real rate is the rate that has been adjusted to remove the effects of inflation to replicate the price of funds to the borrower and to an investor.

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Corporate Finance

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