Given a nominal interest rate of 10 percent, in which of the following cases would you earn the highest after-tax real interest rate?

Select one:

Inflation is 6 percent, and the tax rate is 20 percent.

Inflation is 5 percent, and the tax rate is 30 percent.

Inflation is 2 percent, and the tax rate is 50 percent.

Inflation is 4 percent, and the tax rate is 40 percent.