A small business takes out a loan with a nominal interest ra…
A small business takes out a loan with a nominal interest rate of 8% to expand its operations. If the inflation rate is 3%, what is the real interest rate on the loan? How would an unexpected increase in inflation to 5% affect the real interest rate, and what implications would this have for the business and the lender?
Read DetailsKarla is planning to buy a house in 3 years. Approximately,…
Karla is planning to buy a house in 3 years. Approximately, how much will she have to set aside each year to have $30,000 down payment in 3 years if the interest rate she receives is 5% per year? Which of the following choices would help you arrive to the answer?
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