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vekshin1
3 years ago
12

Suppose Sally borrows $1,000 from Harry for one year and agrees to pay a nominal interest rate of 9%. When she borrows the money

, both she and Harry expect an inflation rate of 6%. 1st attempt Part 1 (0.3 point)See Hint The expected real interest rate on the loan is %. Part 2 (0.3 point)See Hint Suppose that when Sally pays back the loan after one year, the actual inflation rate turns out to be 7%. The actual real interest rate on
Business
1 answer:
Lilit [14]3 years ago
3 0

Answer:

Instructions are listed below

Explanation:

Giving the following information:

Suppose Sally borrows $1,000 from Harry for one year and agrees to pay a nominal interest rate of 9%. When she borrows the money, both she and Harry expect an inflation rate of 6%. Suppose that when Sally pays back the loan after one year, the actual inflation rate turns out to be 7%.

Real rate= nominal rate - inflation rate

At the beginning of the loan, the expected real rate is:

Real rate= 9 - 6= 3%

The actual rate is:

Real rate= 9 - 7= 2%

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The Herfindahl index equals sum of the squared percentage market shares of all firms in an industry.

<h3>What is Herfindahl index?</h3>

The Herfindahl Index can be regarded as the common measure of market concentration which is used in measuring the market in term of the competition.

In calculating this  Herfindahl Index, we can determine the pre- and post-M&A and  equals sum of the squared percentage market shares .

Learn more about  Herfindahl index at; brainly.com/question/15701307

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Why is producing a high quality product important to rolls royce ?
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In a closed​ economy, the values for​ GDP, consumption​ spending, investment​ spending, transfer​ payments, and taxes are as​ fo
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