If the Nominal Interest Rate Is 11%,the Inflation Rate Is

question 49

Multiple Choice

If the nominal interest rate is 11%,the inflation rate is 4% and the tax rate is 25%,what is the real after-tax interest rate?

• A)-1.25%
• B)4.25%
• C)5.25%
• D)8%
• E)10%

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Definitions:

Amortization Expense

An operating expense on the income statement relating to intangible assets.

Ordinary Maintenance

Ordinary maintenance refers to the routine tasks and repairs carried out regularly to keep equipment or buildings in working condition.

Field Slaves

Individuals subjected to slavery who worked primarily in the fields, performing hard manual labor under often harsh conditions in agricultural production.

House Slaves

Enslaved individuals who worked inside the homes of their masters, performing domestic tasks, during periods of slavery.