Expected inflation on short term loans

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A banker must earn at least a 2.4% return after expected inflation on short term loans. The inflation rate for the past 6 months has average 5.9%. the expected inflation rate for the next 12 months is 6.5% nominal interest rates for short term loans were 10.5% last month. What is the minimum nominal interest rate that he should charge for a one year loan?

Reference no: EM13999853

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