If the Nominal Interest Rate Is 6% and the Inflation

question 10

Multiple Choice

If the nominal interest rate is 6% and the inflation rate is 9%,then the real interest rate is

• A)-3%.
• B)3%.
• C)6.67%.
• D)15%.

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Definitions:

Purpose

The justification for the existence, creation, or action of something.

Return on Assets

Return on assets (ROA) is a financial ratio that indicates how profitable a company is relative to its total assets, calculating how effectively a company uses its assets to generate profit.

Analytical Tool

Instruments or techniques used to analyze or dissect financial or system data to gain insights and aid in decision making.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, presented in a structured manner to allow easy understanding of financial performance.