document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1179979>Question 1179979</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Is it D? I want to check my answer.\r<BR>\n" );
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document.write( "Topic: Financial Mathematics \r<BR>\n" );
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document.write( "Anika’s savings account has a stated interest rate of 2.5%. After inflation, the real return on her savings account is 1%. What is the nominal interest rate on the account?\r<BR>\n" );
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document.write( "A. -1%\r<BR>\n" );
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document.write( "B. 1%\r<BR>\n" );
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document.write( "C. 1.5%\r<BR>\n" );
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document.write( "D. 2.5%  </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #809515 by </B><A HREF=/tutors/aboutme.mpl?userid=MathLover1><B>MathLover1(20849)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=MathLover1><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=MathLover1><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=809515\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> \r<BR>\n" );
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document.write( "we know that:<BR>\n" );
document.write( "a stated interest rate of <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=2.5 ALIGN=MIDDLE  ALT=\"2.5\"   DISABLED_style= \"max-width:90%; height:auto;\" >%<BR>\n" );
document.write( "the real return on her savings account is <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=1 ALIGN=MIDDLE  ALT=\"1\"   DISABLED_style= \"max-width:90%; height:auto;\" >%.\r<BR>\n" );
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document.write( "The stated interest rate  is a percentage which is calculated per year and refers to the return on the investment made.<BR>\n" );
document.write( "The nominal interest rate is the rate received by the depositor before taking into account the inflation rate.\r<BR>\n" );
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document.write( "therefore:<BR>\n" );
document.write( "The <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=nominal+ ALIGN=MIDDLE  ALT=\"nominal+\"   DISABLED_style= \"max-width:90%; height:auto;\" >interest rate is <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=equal ALIGN=MIDDLE  ALT=\"equal\"   DISABLED_style= \"max-width:90%; height:auto;\" > to the <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=stated+ ALIGN=MIDDLE  ALT=\"stated+\"   DISABLED_style= \"max-width:90%; height:auto;\" >interest rate and does not include the inflation rate.\r<BR>\n" );
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document.write( "Since the <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=stated+ ALIGN=MIDDLE  ALT=\"stated+\"   DISABLED_style= \"max-width:90%; height:auto;\" >rate in this problem is <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=2.5 ALIGN=MIDDLE  ALT=\"2.5\"   DISABLED_style= \"max-width:90%; height:auto;\" >%, the <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=nominal ALIGN=MIDDLE  ALT=\"nominal\"   DISABLED_style= \"max-width:90%; height:auto;\" > rate of interest for this savings account is also <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=2.5 ALIGN=MIDDLE  ALT=\"2.5\"   DISABLED_style= \"max-width:90%; height:auto;\" >%\r<BR>\n" );
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document.write( " </SPAN>\n" );
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