If Treasury bills are currently paying 4.2 percent and the inflation rate is 2.6 percent, what is the approximate real rate of interest? The exact real rate?
A) 1.60 percent; 1.56 percent
B) 1.60 percent; 1.64 percent
C) 6.80 percent; 6.67 percent
D) 6.80 percent; 6.87 percent
E) 6.80 percent; 6.92 percent
Correct Answer:
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