A year ago, you invested $10,000 in a savings account that pays an annual interest rate of 5%.What is your approximate annual real rate of return if the rate of inflation was 3.5% over the year
A)1.5%
B)10%
C)7%
D)3%
E)None of the options

Name: A year ago, you invested $10,000 in a savings account that pays an annual interest rate of 5%.What is your approximate annual real rate of return if the rate of inflation was 3.5% over the year A)1.5% B)10% C)7% D)3% E)None of the options
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Question

Quizplus · Accepted Answer

5% - 3.5% = 1.5%.

A Year Ago, You Invested $10,000 in a Savings Account