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If the rate of inflation is 5%, what nominal interest rate is necessary for you to earn a 3% real interest rate on your investm...Asked by Anonymous
If the rate of inflation is 5%, what nominal interest rate is necessary for you to earn a 3% real interest rate on your investment?
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Answered by
drwls
8%, if you ignore taxes.
Tax rates on interest income depend upon income level, whether you are in the AMT category, and the type of fixed-income investment. Municipal bonds and money market funds that hold them are tax free in the USA.
Tax rates on interest income depend upon income level, whether you are in the AMT category, and the type of fixed-income investment. Municipal bonds and money market funds that hold them are tax free in the USA.
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