Waec Model Questions Vol1 2025 Economics Question 28
Practice objective / multiple choice question 28 from the 2025 Waec Model Questions Vol1 Economics examination.
A commercial bank advertises a nominal interest rate of 12 % per annum. Expected inflation for the next year is 8 %, while for the following year it is expected to be 5 %. Using the Fisher approximation (real ≈ nominal - inflation), compute the real interest rate for each of the two years and state by how many percentage points the real rate is higher in the second year.
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About This Question
This is Waec Model Questions Vol1 2025 Economics Question 28. It is one of the objective questions from the 2025 Waec Model Questions Vol1 Economics examination.
Difficulty level: Medium .
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