Neco 2021 Economics Question 42
Practice objective / multiple choice question 42 from the 2021 Neco Economics examination.
The consumer price index (CPI) was 100 in 2020 and rose to 105 in 2021. The central bank wants to keep the real interest rate at 4\% in 2022. If the expected inflation rate for 2022 is assumed to be the same as the inflation observed between 2020 and 2021, what nominal interest rate should the bank set for 2022? Express your answer as a percentage to one decimal place.
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About This Question
This is Neco 2021 Economics Question 42. It is one of the objective questions from the 2021 Neco Economics examination.
Difficulty level: Medium .
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