You deposit $200 in a savings account on January 1, and the bank pays you interest of $10 at the end of the year. During the year, the average price level rises by 2 percent. What is the real interest rate on your savings account? The real interest rate on your savings account is _______. A. 3 percent a year B. 2 percent a year C. $6 D. 6 percent a year

You deposit $200 in a savings account on January 1, and the bank pays you interest of $10 at the end of the year. During the year, the average price level rises by 2 percent. What is the real interest rate on your savings account? The real interest rate on your savings account is _______. A. 3 percent a year B. 2 percent a year C. $6 D. 6 percent a year

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter18: Savings,investment And The Financial System

Section: Chapter Questions

Problem 3QR

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