The real return is the difference between the nominal and actual rate of inflation. Therefore, the real return revived by Luigi will be 6%.
<u>Given</u><u> </u><u>the</u><u> </u><u>Parameters</u><u> </u><u>:</u>
- <em>Nominal rate = 7% </em>
- <em>Actual rate of inflation = 1%</em>
<em>Real return = Nominal rate - Actual rate of return </em>
Real Return = 7% - 1% = 6%
Therefore, the real return on Luigi's money would be 6%
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Answer:
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At first situation, ratio = x/y = 1/5
5x = y -------Equation (i)
Now, after adding 5 more red, it is = x + 5 / y+5 = 1/3
y+5 = 3(x + 5)
y + 5 = 3x + 15
y - 3x = 15 - 5
Substitute the value of y from equation (1),
5x - 3x = 15 - 5
2x = 10
x = 10/2
x = 5
Originally, There were 5 red marbles in the bag
Hope this helps!
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