What is the real interest rate for a savings account that has a nominal interest rate of 1% when the rate of inflation is 1% ?
a.) -2%
b.) 0%
c.) 1%
d.) 2%

Option B.) 0%

Step-by-step explanation:

we know that

To find the real interest rate, we take the nominal interest rate and subtract the inflation rate

Let

x > nominal interest rate

y > the inflation rate

The real interest rate is

x-y

we have

x=1%

y=1%

substitute

1%-1%=0%

step-by-step explanation:

the original amount doesn't ''re just looking for the time it takes for 1/2 of the substance to we have

(1/2) =)     take the ln   of both sides

ln (1/2)   = )   and we can write

ln(1/2) = ) lne     and lne   = 1     so we have

ln(1/2) = -.1092t     divide both sides by -.1092

t = ln(1/2)/-.1092 = about 6.347 days = about 6.3 days (rounded)