What does this mean about real interest rate on bank savings

Reference no: EM133289245

Assignment:

Bank savings accounts typically pay an interest rate well below the inflation rate. As of spring 2017, for example, the best interest rates on savings accounts were around 1% per year, while the CPI inflation rate was around 2.5% per year. What does this mean about the real interest rate on bank savings? Knowing this, why would people still choose to deposit any money in bank savings accounts?

Reference no: EM133289245

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