Luigi is willing to lend Klaus $5,000 for one year at a nominal rate of interest of 7%. Both Luigi and Klause expect the rate of inflation to be 2% in the next year. If the actual rate of inflation over the year was 1%, what is the real return did Luigi receive

6%

Explanation:

In order to calculate the real return we would simply subtract the actual rate of inflation from the nominal rate of interest that has been calculated. In this scenario, the nominal rate is 7% and the actual inflation that year was 1% therefore the real return is 6%. This is the actual amount of return that Luigi will profit from the amount that he lent clause in the span of 1 year.

7% - 1% = 6%

explanation: doctrine of respondeat superior is a legal doctrine that is commonly used in tort. this principle makes an employer or principal legally responsible for the wrongful acts done by an employee or agent, if such acts occur within the scope of the employment or agency.

the answer is d

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