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You currently have $100 in the bank which pays a 9% pa interest rate. Apples currently cost $1 each at the shop and the inflation
You currently have $100 in the bank which pays a 9% pa interest rate. Apples currently cost $1 each at the shop and the inflation rate is 6% pa which is the expected growth rate in the apple price. All rates are given as effective annual rates. Which of the below statements is NOT correct? Select one: a. In 2 years the nominal apple price will be $1.057405. b. The real growth rate in the apple price is expected to be 0% pa. c. In 2 years your money in the bank will be worth $118.810001 in nominal terms. d. In 2 years your money in the bank will be worth $105.740478 in real terms. e. The real bank interest rate is 2.830189% pa
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