Question

Reflection of compensation in real rate of interest rate belong to​

Answer 1

Answer:

A real interest rate is an interest rate that has been adjusted to remove the effects of inflation to reflect the real cost of funds to the borrower and the real yield to the lender or to an investor. The real interest rate reflects the rate of time-preference for current goods over future goods. The real interest rate of an investment is calculated as the difference between the nominal interest rate and the inflation rate:

please make me brainlist

Answer 2

Answer:

Explanation:

Concept:

A real interest rate has been adjusted for inflation, and it reflects the borrower's real cost of money as well as the lender's real yield.

Explanation:

The real interest rate compensates for the effects of inflation on the observed market interest rate. The real interest rate indicates the purchasing power of interest paid on an investment or loan, as well as the borrower and lender's rate of time preference.

#SPJ3