If the nominal rate of interest is 10.5 percent, and the inflation rate is 4.3 percent, what is the real rate of interest?
A)3.0 percent
B)4.3 percent
C)6.2 percent
D)10.5 percent

Question

If the nominal rate of interest is 10.5 percent, and the inflation rate is 4.3 percent, what is the real rate of interest?
A)​3.0 percent
B)​4.3 percent
C)​6.2 percent
D)10.5 percent

Quizplus · Accepted Answer

Real rate of interest = nominal rate of interest - inflation rate 
Real rate of interest = 10.5% - 4.3% 
Real rate of interest = 6.2%

If the Nominal Rate of Interest Is 10