Bank savings accounts typically pay an interest rate well below the inflation rate. As of spring 2011,

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Bank savings accounts typically pay an interest rate well below the inflation rate. As of spring 2011, for example, the best interest rates on savings accounts were around 1% per year, while the CPI inflation rate was around 2.5% per year. What does this mean about the real interest rate on bank savings? Knowing this, why would people still choose to deposit any money in bank savings accounts?
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Modern Principles of Economics

ISBN: 978-1429278393

3rd edition

Authors: Tyler Cowen, Alex Tabarrok

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