The Nominal Interest Rate Is 4%,the Inflation Rate Is 1

question 65

Multiple Choice

The nominal interest rate is 4%,the inflation rate is 1% and the tax rate is 20%.Given U.S.tax laws,how is after-tax real return computed?

• A).03(1-.20)
• B).04(1 -.20)
• C).04(1 - .20)- .01
• D)None of the above is correct.