Suppose a bank wants to earn a real rate of interest equal to 8.76% and they expect the rate of inflation to be 7.70%.  At what interest rate will they set this loan to be? 

 Answer this as a percentage and round your answer to two digits after the decimal without the percentage. ex. If you found the inflation rate to be 5.125%, answer 5.13.

Answer rating: 100% (QA)

To determine the nominal interest rate the bank should s... View the full answer