If a person has money invested at 9 percent and the rate of inflation is 5 percent, how much return are they actually making on their investment?

4%

Explanation:

It is given that a person has money invested at 9 percent and the rate of inflation is 5 percent.

We need to find the actual interest rate.

Real interest rate = Rate of interest - Rate of inflation

Substitute the given values in the above formula to find the actual interest rate.

Real interest rate = 9% - 5%

Real interest rate = 4%

Therefore, the real interest rate on their investment is 4%.

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