Final answer:
The inflation rate is calculated by subtracting the real interest rate from the nominal interest rate, yielding 3.5 percent as the answer.
Step-by-step explanation:
The student has asked for the inflation rate given that the nominal interest rate is 6 percent and the real interest rate is 2.5 percent.
To find the inflation rate, we use the formula: nominal interest rate = real interest rate + inflation rate. Plugging in the values we have: 6% (nominal interest rate) = 2.5% (real interest rate) + inflation rate. By rearranging the equation, we find that the inflation rate = 6% - 2.5%, which equals 3.5 percent.
Therefore, the answer is c. 3.5 percent.
The inflation rate can be calculated by subtracting the real interest rate from the nominal interest rate. In this case, the nominal interest rate is 6% and the real interest rate is 2.5%. So, the inflation rate is 6% - 2.5% = 3.5%.