Question

Oscar has deposited $4,000 in a savings account at 1.5% interest. What is his real interest rate if the current inflation rate is 2.5%?
a. −1%
b. 4%
c. 3.75%
d. −0.6%

Answer 1

Answer:

-1%

Step-by-step explanation:

Just finished the quiz with 100%

Answer 2

Answer:

A. -1%

Step-by-step explanation:

If the inflation is 2.5% and the savings account had an original 1.5% interest rate, simply subtract.

1.5 - 2.5 = -1

-1%