What inflation rate would make the after-tax real interest rate equal the pretax real rate (that is,

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What inflation rate would make the after-tax real interest rate equal the pretax real rate (that is, what inflation rate implies (r) = r)? Explain.

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Money Banking and Financial Markets

ISBN: 978-1429244091

2nd edition

Authors: Laurence M. Ball

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Question Posted: Dec 05, 2015 03:46 AM

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What inflation rate would make the after-tax real interest rate equal the pretax real rate (that is,

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Plugging the definition r 1 r n into the equation r r gives 1 r r solve this equation ...View the full answer

Money Banking and Financial Markets

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