In 1975, interest rates were 7.85% and the rate of inflation was 12.3% in the United States. What was the real interest rate in 1975? How would the purchasing power of your savings have changed over the year?(Note: Be careful not to round any intermediate steps less than six decimal places.) What was the real interest rate in 1975? (Round to two decimal places.)

In 1975, interest rates were 7.85% and the rate of inflation was 12.3% in the United States. What was the real interest rate in 1975? How would the purchasing power of your savings have changed over the year?(Note: Be careful not to round any intermediate steps less than six decimal places.) What was the real interest rate in 1975? (Round to two decimal places.)

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

ChapterP2: Part 2: Exchange Rate Behavior

Section: Chapter Questions

Problem 3Q

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