If the nominal interest rate is 8 percent and inflation is 3 percent, approximately what is the real interest rate?
A) 5 percent
B) 11 percent
C) 3 percent
D) 8 percent

Name: If the nominal interest rate is 8 percent and inflation is 3 percent, approximately what is the real interest rate? A) 5 percent B) 11 percent C) 3 percent D) 8 percent
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Question

Quizplus · Accepted Answer

Real interest rate = nominal interest rate - inflation rate
Real interest rate = 8% - 3%
Real interest rate = 5%

If the Nominal Interest Rate Is 8 Percent and Inflation