If the bank returns $1,060 on $1,000 deposited for a year during which inflation was 4 per cent,the real interest rate is

Name: If the bank returns $1,060 on $1,000 deposited for a year during which inflation was 4 per cent,the real interest rate is
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The nominal interest rate is 6% ($1,060 - $1,000 = $60, which is 6% of $1,000). The real interest rate is the nominal rate minus the inflation rate: 6% - 4% = 2%.

If the Bank Returns $1,060 on $1,000 Deposited for a Year