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Real interest rate = nominal interest rate- inflation rate.
If a burger in 2007 is for $100
and if the same burger in 2008 is for $110
then Inflation rate is 10% for 2007
If interest rate in 2007 is 13%
and in 2008 interest rate is 14%
real interest would be only 14%-10% = 4%
That is in real value the return on investment is only 4% because purchasing power of 10% is decreased because of inflation
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