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frozen [14]
3 years ago
7

Suppose the nominal annual interest rate on a two-year loan is 8 percent and lenders expect inflation to be 5 percent in each of

the two years. The annual real rate of interest is:______.
A. 6 percent.
B. 8 percent
C. 2 percent.
D. 3 percent.
Business
1 answer:
Kisachek [45]3 years ago
5 0

Answer:

C. 2 percent.

Explanation:

The computation of the annual real rate of interest is presented below:

Provided that

Nominal annual interest rate = 8%

Inflation rate = 5%

So, the annual real rate of interest is

Real rate of return = {( 1 + nominal annual rate of return) ÷ ( 1 + inflation rate)} - 1

= {( 1 + 0.08) ÷ ( 1 + 0.05)} - 1

= 2%

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Creating an emergency fund should be a top priority, because you need to have extra money in case an emergency comes up that requires money.

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Salon Du Jour offers special combination packages at a reduced price. Separately, a haircut is $30 and a conditioning treatment
adell [148]

The given scenario is referred to as product bundle pricing.

Option E

<u>Explanation: </u>

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3 years ago
In the 1990s, Philips Electronics developed a new consumer electronics product called the Digital Compact Cassette (DCC) player.
9966 [12]

Answer:

compatibility

Explanation:

The Digital Compact Cassette is an innovation that is showing compatibility because it is not only bringing something new to the customer (the ability to record and playback), but also giving the customer the possibility of playing old cassette tapes in the new format.

In simple words, the DCC is compatible with older tapes, which gives it no only a value as a new product, but also a value as a product that replaces and old product (which is not necessarily the same, many new products do not replace old product, the old product simply disappears).

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4 years ago
Researchers have found which of these to be the most popular downward influence tactics?
8_murik_8 [283]
Exchange tactics could be the most popular downward influence tactics....
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3 years ago
Sweet Catering completed the following selected transactions during May 2016: May 5: Received and paid electricity bill, $140 Ma
Alex73 [517]

Answer: (1) $5,290

(2) $3,470

Explanation:

Net Income from Accrual method:

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= $3,470

4 0
3 years ago
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