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joanne1718 joanne1718
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4 years ago
A business borrows from a bank at 7 percent but expects 3 percent general inflation in the economy. What are the nominal and real rates of interest facing this borrower?
Textbook 
Macroeconomics: Principles, Applications and Tools

Macroeconomics: Principles, Applications and Tools


Edition: 7th
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wrote...
4 years ago
The borrower's nominal interest rate is 7 percent and the real interest rate is 4 percent.
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