# Macroeconomics

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The annual nominal rate of interest on a bank certificate of deposit is 12%. What would be the effect of an inflation rate of 13% and why?

• Macroeconomics -

Why are you taking such an out-of-date class? Most CDs are paying less than 1% per year.

• Macroeconomics -

idk. it's just a homework question to see if we understand the subject i guess.

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Please someone show me how to work this one out?
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