4..

that is expected to earn a 11% nominal rate of interest. The consensus forecast of leading economists is a 5% rate of inflation over the coming year. a. How many socks can Zane purchase today? b. How much money will Zane have at the end of 1 year if he forgoes purchasing the socks today and invests his money instead? (Ignore taxes.) c. How much would you expect the socks to cost at the end of 1 year in light of the expected inflation? the end of 1 year? e. What is Zane's approximate real rate of return over the year? How is it related to the percentage change in Zane's buying power found in part d? Explain. a. The number of socks Zane can purchase today is socks. (Round to the nearest whole number.)