The real interest rate is 6 percent a year and the income tax rate is 50 percent.   With no​ inflation, what is the real​ after-tax interest​ rate?   If the inflation rate rises to 4 percent a​ year, what is the real​ after-tax interest​ rate

Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter14: Money And The Economy
Section14.4: Money And Interest Rates
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The real interest rate is 6 percent a year and the income tax rate is 50 percent.
 
With no​ inflation, what is the real​ after-tax interest​ rate?
 
If the inflation rate rises to 4 percent a​ year, what is the real​ after-tax interest​ rate?
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