To approximate the real interest rate, you can use the Fisher equation, which relates the nominal interest rate (i) to the real interest rate (r) and the inflation rate (π) as follows:

$`$1` + r = \frac{1 + i}{1 + \pi}$$

Now, plug these values into the Fisher equation to calculate the real interest rate (r):

$`$1` + r = \frac{1 + 0.11}{1 + 0.035} = \frac{1.11}{1.035}$$

$\Rightarrow 1 + r = 1.07246$

$\Rightarrow r = 1.07246 - 1 \approx 0.07246 \text{ or } 7.25\%$