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please do not use handwriting or pictures Q3. If the expected inflation rate is 10 percent and the real rate of interest is 4 percent:
please do not use handwriting or pictures
Q3. If the expected inflation rate is 10 percent and the real rate of interest is 4 percent:
- Compute the nominal rate of interest. (Hint: use equation 2.1) (0.5 mark)
- Briefly differentiate between the nominal and the real rates of interest. (0.5 mark)
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