Neco Model Questions Vol1 2024 Economics Question 39
Practice objective / multiple choice question 39 from the 2024 Neco Model Questions Vol1 Economics examination.
A bank advertises a nominal interest rate of 12 % per annum. Expected inflation for the next year is 8 %. An alternative inflation‑indexed investment guarantees a real return of 5 % per annum. Using the Fisher equation, by how many percentage points does the inflation‑indexed investment's nominal return exceed the bank's nominal rate? (Give your answer to one decimal place.)
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About This Question
This is Neco Model Questions Vol1 2024 Economics Question 39. It is one of the objective questions from the 2024 Neco Model Questions Vol1 Economics examination.
Difficulty level: Medium .
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