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2 years ago

The difference between the nominal interest rate and the real interest rate is

2 answers:

8 0

Answer: the correct answer is letter D. the nominal interest rate is the stated interest rate whereas the real interest rate is the nominal interest rate minus the inflation rate.

Explanation: in financial maths when you speak about "real" rates you should consider the inflation impact.

anyanavicka [17]2 years ago

8 0

Answer:

D. the nominal interest rate is the stated interest rate whereas the real interest rate is the nominal interest rate minus the inflation rate.

Explanation:

The nominal interest rate is that interest rate that is advertised by the financial institutions either as interest on loan or deposit. Since it is the interest rate stated in financial instruments like the ones quoted on bonds, it is also seen as the stated interest rate.

The real interest rate is the interest rate which has been adjusted to remove the effect of inflation. That is, to get the real interest rate, take the nominal interest rate and subtract the inflation rate. therefore, we can use the following formula.

Real Interest Rate = Nominal Interest Rate - Inflation Rate.

In fact the real interest rate can be sen as the real cost of borrowing money.

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2 years ago

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2 years ago

Amazon has decided to enter the college bookstore market. The goal of "Amazon Campus" is to offer co-branded university-specific

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Answer: product diversification

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Product diversification is when the original market for a product is being expanded. Product diversification is used to boost a brand and also increase sales.

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2 years ago

Question 5 Industry is the supply side of the market. A)True B)False

Afina-wow [57]

Answer:

A) True

Explanation:

A good way to think about it is that industry, a general term for businesses engaging in productive practices, is concerned with the production of goods. These are the goods that are demanded by consumers. So as 'industry' is supplying those goods, it must be on the supply side of the market.

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3 years ago

A project has an initial cost of $2,400. The cash inflows are $0, $1,600, $1,100, and $700 over the next four years, respectivel

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Answer:

It will take 2.73 years to cover the initial investment.

Explanation:

The payback period is the time required to cover the initial investment:

Year 1= 0 - 2,400= -2,400

Year 2= 1,600 - 2,400= -800

Year 3= 1,100 - 800= $300

To be more accurate:

(800/1,100)= 0.73

It will take 2.73 years to cover the initial investment.

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2 years ago