If the nominal rate of interest is
13.94 %13.94%
and the real rate of interest is
7.3 %7.3%,
what is the expected rate of inflation?
The expected rate of inflation is
nothing%
(1+real rate)=(1+nominal rate)/(1+inflation rate)
(1+0.073)=(1+0.1394)/(1+inflation rate)
1+inflation rate=(1.1394/1.073)
inflation rate=(1.1394/1.073)-1
=6.19%(Approx).
If the nominal rate of interest is 13.94 %13.94% and the real rate of interest is...
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