Suppose the nominal interest rate is 4% and the rate of inflation is 3%. The real interest rate is therefore
A) 7%.
B) 1%.
C) 0%.
D) -1%.
E) none of the above.
B
Economics
You might also like to view...
In the long run, changing technology on average has led to: a. lower employment and lower wage rates
b. higher employment and lower wage rates. c. lower employment with wage rates unchanged. d. higher employment with wage rates unchanged. e. higher incomes and more leisure time.
Economics
Which of the following is most indicative of a recession?
a. a decline in unemployment b. a rise in inflation c. a decline in real GDP d. an increase in the interest rate
Economics