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An investor requires a 3 percent increase in purchasing power in order to induce her to lend. She expects inflation to be 2 percent next year. The nominal rate she must charge i…

An investor requires a 3 percent increase in purchasing power in order to induce her to lend. She expects inflation to be 2 percent next year. The nominal rate she must charge i…
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An investor requires a 3 percent increase in purchasing power in order to induce her to lend. She expects inflation to be 2 percent next year. The nominal rate she must charge is about:_______.

A.1%
B. 2%
C. 3%
D. 5%
E. 7%

asked
User Ndclt
by
8.7k points

1 Answer

6 votes

Answer:

The correct answer will be D. 5%

Step-by-step explanation:

answered
User Bogdan Verbenets
by
7.5k points
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