Imagine you borrow $500 from your roommate, agreeing to pay her back $500 plus 7 percent nominal interest in one year. Assume inflation over the life of the contract is expected to be 4.25 percent. What is the total dollar amount you will have to pay her back in a year?
What dollar amount of the interest payment is the result of the real rate of interest?
a) What is the total dollar amount?
b) What is the interest payment?
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Imagine you borrow $500 from your roommate, agreeing to pay her back $500 plus 7 percent nominal interest in one year. Assume inflation ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
A period of very low inflation would most likely lead to
Answers (1)
Billy Ray owns several parcels of rental real estate, and he actively participates in managing the properties. His total loss from these activities in 2019 is $30,000 and his AGI for 2019 is $110,000.
Answers (1)
What cost advantages does E - Commerce offer to businesses
Answers (1)
The interest rate effect: is the change in exports and imports, resulting from changes in the interest rate caused by changes in the aggregate price level.
Answers (1)
The controller of Hartis Corporation estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below: Wall Mirrors Specialty Windows Total expected units produced
Answers (1)
New Questions in Business
A nut store normally sells cashews for $4.00 per pound and peanuts for $1.50 per pound. But at the end of the month the peanuts had not sold well, so, in order to sell 40 pounds of peanuts, the manager decided to mix the 40 pounds of peanuts with
Answers (1)
The Bolen Company forecasts that total overhead for the current year will be $8,000,000 and that total machine hours will be 200,000 hours. Year to date, the actual overhead is $10,000,000 and the actual machine hours are 80,000 hours.
Answers (1)
Four trends in the past decade have significantly influenced the landscape of global marketing. one of them is
Answers (1)
Badger Corporation declared a stock distribution to all shareholders of record on March 25 of this year. Shareholders will receive one share of Badger stock for each 10 shares of stock they already own.
Answers (1)
Marketing ethics is most important for advertising agencies. maximizes an organization's positive impact on society. refers to principles and standards that define acceptable conduct in marketing. are laws and regulations that govern marketing.
Answers (2)