If the Annual Rate Is 10% and Inflation Is 4

question 57

Multiple Choice

If the annual rate is 10% and inflation is 4%, then the approximate real rate of return is:

• A)14.00%
• B)4.00%
• C)6.00%
• D)6.80%
• E)7.00%

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Definitions:

Student Loans

Student loans are borrowed funds provided to students to cover education-related expenses, which must be repaid with interest over time.

Simple Interest

Interest calculated on the principal amount of a loan or deposit, without compounding.

Loan Balance

The amount of money that remains to be paid on a loan.

Student Loans

Money borrowed to pay for education expenses, which must be repaid with interest.