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

Question

Quizplus · Accepted Answer

Real interest rate is calculated by subtracting inflation rate from nominal interest rate. Therefore, the real interest rate in this scenario would be 5 percent (8 percent - 3 percent).

If the Nominal Interest Rate Is 8 Percent and the Current