$MathMaster logo$

MathMaster

Home
general
suppose that the one year real interest rate in period 0 is 12 and that the inflation rate is 4 5 so the nominal interest

Question

Suppose that the one-year real interest rate in period 0 is 12% and that the inflation rate is 4.5%. So the nominal interest rate is?

234

likes

1170 views

Answer to a math question Suppose that the one-year real interest rate in period 0 is 12% and that the inflation rate is 4.5%. So the nominal interest rate is?

$Expert avatar$

4.9

99 Answers

1 + i = (1 + 0.12)(1 + 0.045)

1 + i = 1.12 \cdot 1.045

1 + i = 1.1694

i = 1.1694 - 1

i = 0.1694

i \approx 0.1704 \quad \text{or} \quad 17.04\%

The nominal interest rate, given a real interest rate of 12% and an inflation rate of 4.5%, is approximately 17.04%.

Frequently asked questions (FAQs)

What is 35% of 75?

+

Question: Convert 0.00000254 km² to scientific notation.

+

Math question: What fraction of a pizza is remaining if 2/3 of it has been eaten?

+

New questions in Mathematics

If O(3,-2) is reflected across x = 2. What are the coordinates of O

Determine the equations of the recipes that pass through the following pairs of points P1 (2;-1) and p2 (4;-1)

[(36,000,000)(0.000003)^2]divided(0.00000006)

The data set (75, 85, 58, 72, 70, 75) is a random sample from the normal distribution No(µ, σ). Determine a 95% two-sided confidence interval for the mean µ .

prove that if n odd integer then n^2+5 is even

-3(-4x+5)=-6(7x-8)+9-10x

. What will be the osmotic pressure of a solution that was prepared at 91°F by dissolving 534 grams of aluminum hydroxide in enough water to generate 2.784 ml of solution.

Quadratic equation 2X = 15/X + 7

(X+2)(x+3)=4x+18

Determine the Linear function whose graph passes through the points (6, -2) and has slope 3.

A buyer purchased a North Carolina home for $475,250. The seller allowed the buyer to assume his first small mortgage with a loan balance of $110,000. How much is the excise tax paid in the transaction? $951 $729.50 $950.50 $221 none of the above

a) Statistics scores are normally distributed with the mean of 75 and standard deviation of 7. What is the probability that a student scores between 80 and 88

The average undergraduate cost per tuition, fees, room, and board for all institutions last year was $26,025. A random sample of 40 institutions of higher learning this year indicated that the mean tuition, fees, room, and board for the sample was $27,690, and the population standard deviation is $5492. At the 0.05 level of significance, is there sufficient evidence that the cost has increased? (Remember to follow the steps in hypothesis testing)

8/9 divided by 10/6

How many moles are there in 235 grams of potassium thiosulfate pentahydrate? K2S2O3*5(H2O)

A person travels by car from one city to another with different constant speeds between pairs of cities. She drives for 55.0 min at 100.0 km/h, 14.0 min at 65.0 km/h, and 45.0 min at 60.0 km/h and spends 20.0 min eating lunch and buying gas. (a) Determine the average speed for the trip.

f(r) = 1/r+9 find f(x^2) + 1