Question: 2-8. (Real interest rates: approximation method) You have been asked to provide an approximation of the real interest rate considering following situation: the real riskfree

2-8. (Real interest rates: approximation method) You have been asked to

2-8. (Real interest rates: approximation method) You have been asked to provide an approximation of the real interest rate considering following situation: the real riskfree rate of interest is 4.8% and the expected rate of inflation is constant at 3.1%. What return on a 1-year Treasury bill can be expected? Ignore the cross product between the real rate of interest and the inflation rate

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