Multiple Choice
In the country of Hyrkania, the CPI in 2005 was 140 and the CPI in 2006 was 154. Jake, a resident of Hyrkania, borrowed money in 2005 and repaid the loan in 2006. If the nominal interest rate on the loan was 14 percent, what was the real interest rate?
A) 18 percent
B) 14 percent
C) 10 percent
D) 4 percent
Correct Answer:
Verified
Correct Answer:
Verified
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