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If a Bank Is Lending Money at 6

Question 5

Multiple Choice

If a bank is lending money at 6.25% while the government is lending money at 8.25% and the rate of inflation is 3.5%, what is the real interest being earned by the bank?


A) 2.00%
B) 2.66%
C) 2.75%
D) 6.25%

Correct Answer:

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