Calculate the real interest rate when nominal interest rate is 7% and inflation rate is 2%

Q: The real interest rate is approximately equal to A. the growth in real GDP. B. the nominal interest…

A: since you have asked multiple questions and according to our policy we can only solve one question…

Q: What is the real interest rate if the nominal interest rate is 7.73% and the expected inflation rate…

A: The real interest rate is the inflation-adjusted interest rate. It shows the real cost of funds from…

Q: The attached table gives the purchases of a typical consumer in Colorado Springs. These consumers…

A: Inflation is termed as general increase in prices and fall in purchasing power of currency. It is…

Q: When a nominal value increases it must be true that prices have increased. Select one: True False

A: Nominal value: face value of an asset or security.

Q: Assume the nominal interest rate is 17 percent and the expected rate of inflation is 12 percent.…

A: The real interest rate refers to the inflation adjusted interested rate. It can be calculated by…

Q: In an economy inflation is 3% and the nominal interest rate is 3%  Calculate the real interest rate

A: The addition of inflation and real interest rate gives us the value of nominal interest rate Real…

Q: True or false? The nominal rate of interest is the difference between the real rate and the…

A: Nominal interest rate is the interest rate which is stated in loan agreement . It is the rate of…

Q: In which situation is the real interest rate highest? In which situation is the real interest rate…

A: Nominal interest rate refers to the interest rate before taking inflation into account. A real…

Q: If the nominal interest rate is 10 percent and the inflation rate is 4 percent, then the real…

A: Nominal interest rate is the current rate of interest.Real interest rate is the change in interest…

Q: Because there isn't one single measure of inflation, the government and researchers use a variety of…

A: CPI and GDP deflators will be examined in the ensuing discussion. While the GDP deflator considers…

Q: Assume that in Azerbaijan, Alyana deposits $5,000 in the bank for a single year. Given the following…

A: Inflation refers to an increase in the general price level from one period to another. Inflation is…

Q: f the nominal interest rate is 9 percent and the real interest rate is 3 percent, then the inflation…

A: Fisher effect states that the Inflation rate is equal to the nominal rate minus the real Interest…

Q: norminal GDP                      real GDP 2000      13000                                   12900…

A: Formula:  GDP Deflator = (Nominal GDP / Real GDP) *100. Inflation rate = {(Present year GDP…

Q: Because there isn't one single measure of inflation, the government and researchers use a variety of…

A: The main difference between the GDP Deflator and CPI is that the GDP Deflator measures the prices of…

Q: alculate the real interest rate if Nominal Interest rate is 3% and inflation rate is 1%

A: # We know that the real interest rate is given by the difference between the nominal interest rate…

Q: Last year the Carter family earned $50 000. This year their income is $52 000. In an economy with an…

A: The income for the family would be the total amount of money which would be earned by the family.…

Q: Jay and Joyce meet George, the banker, to work out the details of a mortgage. They all expect that…

A: Real interest rate is interest rate adjusted for inflation.

Q: If in the banking sector the nominal interest rate is 3% and inflation rate is 1.7%  Calculate what…

A: The information being given is:- Nominal interest rate in banking rate = 3% Inflation rate = 1.7% We…

Q: If the nominal interest rate on an asset is 10% and inflation is also 8%, what is the real interest…

A: The nominal interest rate is the percentage increase in money you pay the lender for the use of the…

Q: If the real rate of interest is 3% and the expected rate of inflation is 6%m calculate the nominal…

A: The interest rate generally refers to the amount paid to the lender in return for the borrowed money…

Q: If your nominal income in 2016 was $50,000, and prices doubled between 2016 and 2017, to have the…

A: Nominal income refers the income which is not adjusted to inflation. Real income is income which is…

Q: Refer to the hypothetical data in the table to answer the three questions. What was the real…

A: Nominal interest rates refer to the cost of capital/borrowing which are valued at current price…

Q: You are given the following information about the economy: the nominal interest rate = 10 percent,…

A: Given information: The nominal interest rate is 10% The real rate of interest is 3%

Q: In year 1 the price level is constant and the nominal rate of interest is 6 percent. But in year 2…

A: Nominal interest rate = real interest rate + Inflation.

Q: Which of the following would cause the real interest rate to be negative? a.When the nominal…

A: The Fisher calculation forecasts that the nominal rate would equivalent the equilibrium real rate…

Q: For each of the following years, determine the real interest rate. Find the difference between this…

A: Please find the answer below.

Q: Because there isn't one single measure of inflation, the government and researchers use a variety of…

A: GDP deflator for the year is calculated by dividing the value of all the goods and services produced…

Q: The.... rate is equa to the ...... rate ...... the ....... rate a) real interest / nominal interest…

A: The question is based on the Fisher equation.

Q: The government has released the latest retail price index which suggests inflation was 2.14%. A…

A: Given: Annual rate of inflation = 2.14% Present cost of a basket of food = £45.44

Q: In which situation is the real interest rate lowest? Group of answer choices The nominal interest…

A: Formula:-                 Real Interest rate=1+Nominal interest rate1+Inflation rate-1 a) The…

Q: real interest rate is

A: Real interest rate is the rate which a person has after deducting the inflation Or price rise effect…

Q: If inflation rate is 1% and nominal interest rate is 2.1%  What will be the real interest rate

A: The given information is as follows:- Inflation rate in the economy = 1% This shows the general rise…

Q: How each of the real interest rate ad the nominal interest rate is determined and explain the…

A: Real rate of interest and nominal rate of interest.

Q: Ek 3 UK’s inflation has hit a 40 year high (CPI is 9.1% in June 2022). Evaluate the use of interest…

A: A widespread increase in the prices of goods and services in an economy indicates inflation, which…

Q: If the nominal interest rate was 12% and the inflation rate was 10% in 1980, while the nominal…

A: Given information: In 1980, Nominal interest rate: 12% Inflation rate: 10% In 2001, Nominal…

Q: If the nominal interest rate is 5 percent and the inflation rate is 2 percent, what is the real…

A: Nominal interest rate is the rate of interest before the adjustments of inflation. given: Nominal…

Q: If inflation is expected to​ increase,   A. the nominal interest rate will increase.   B.…

A: Real Interest Rate: The real interest rate is the rate that excludes or does not account the…

Q: If the nominal interest rate is 10 percent and the real interest rate is 5 percent, the inflation…

A: Inflation rate: It is the rate of increase in the prices in a particular time period.

Q: If the Consumers Price Index in March 2016 was 1,125 and it was 1,154 in March 2017, this indicates…

A: Inflation rate is calculated by the percentage change in CPI.

Q: In an economy the nominal interest rate is 6% and the inflation is 4%. Calculate real interest rate

A: Following are the given values: Nominal interest rate = 6% Inflation  rate = 4%

Q: Nominal Interest rate is 10% and the real interest rate is 7% Calculate the inflation levle.

A: # According to the fisher's equation we know that the real interest is given as the difference…

Q: The real interest rate in Africa is 1.1%.  In 2019, the inflation rate was 1.6%.  The expected…

A: The Fisher equation is a linear approximation of function representing the relationship between the…

Q: The Nominal Interest rate and inflation rate in an economy is same.  What will be the real interest…

A: The interest rate which is irrespective of inflation is known as nominal interest rate. And the…

Q: In 2019, the inflation was 4.1% and the nominal interest rate was 6.2%  Calculate the real interest…

A: We are given with the values of inflation rate and nominal interest rate in the year of 2019…

Q: If the inflation rate is 8 percent and the real interest rate is 6 percent, the nominal interest…

A: Answer: A (14 percent) Explanation: Nominal interest rate = Real interest rate + Inflation rate…

Q: Assuming the nominal interest rate is positive, ceteris paribus, which of the following statements…

A: We know: Real Interest Rate = Nominal Interest Rate - Inflation This means how much are we earning…

Q: Suppose the value of a price index is 50 in 2015 and 60 in 2016. What is the rate of inflation from…

A: The rate of inflation can be calculated by dividing the difference between current inflation and…