If the nominal interest rate is 6% and the inflation rate is 2%,then the real interest rate is
A)8%.
B)4%.
C)3%.
D)2%.
E)1%.

Name: If the nominal interest rate is 6% and the inflation rate is 2%,then the real interest rate is A)8%. B)4%. C)3%. D)2%. E)1%.
Brand: Quizplus
Rating: 4.9 (36 reviews)

Question

Quizplus · Accepted Answer

The real interest rate is calculated by subtracting the inflation rate from the nominal interest rate. So, in this case, the real interest rate is 6% - 2% = 4%. Therefore, the best choice is B) 4%.

If the Nominal Interest Rate Is 6% and the Inflation