If the nominal interest rate is 5% and the inflation rate is 3%, what is the real interest rate? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

The real interest rate is "3%".

Explanation:

Given:

Nominal interest rate,

n = 5%

Inflation rate,

i = 3%

As we know,

⇒

or,

⇒

By substituting the values, we get

or,

               %    

answer; complain or request hazard correction from your employer;

answer; the nav calculated at the market close at 4: 00 pm new york time;