If the CPI Increased from 215 to 218 Between the Years

question 180

Short Answer

If the CPI increased from 215 to 218 between the years 2012 and 2013, while the nominal interest rate increased from 3.25% to 3.80%, what is the real interest rate in 2013?

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Definitions:

Stockholders' Equity

The residual assets of a company that belong to shareholders after all liabilities have been subtracted, representing ownership interest.

Return On Assets

An overall measure of profitability; computed by dividing net income by average total assets.

Net Income

The total earnings or profit a company generates, calculated as revenue minus expenses, taxes, and deductions.