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macroeconomics

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Suppose you were borrowing money to buy a car. Which of these situations would you prefer:The interest rate on your car loan is 20 percent and the inflation rate is 19 percent or the interest rate on your car loan is 5 percent and the inflation rate is 2 percent? explain

  • macroeconomics -

    Bobpursley already posted his answer.

    Which do you think is the better deal for you?

  • macroeconomics -

    The second case since the inflation is the increase in the price level and 2 percent is lower than 19 percent and the interset is also lower so i'll saved more money

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