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Which one of the inflation rates is best for the bank

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Reference no: EM131191828

The borrowed money at a fixed rate of 5% over 30 years to purchase a house

1. If the rate of inlation is 1%, what the real interest rate of the loan?

2. If the rate of inflation is 4%, what is the real interest rate of the loan? What if the rate was 10%

3. which one of the inflation rates is best for you in terms of the loan repayments? why?

4. Which one of the inflation rates is best for the bank? Why?

Reference no: EM131191828

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