The richest EU country in terms of GPD per capita is:

What is the "big tradeoff"?

What will be an ideal response?

Initially, the nominal rate of interest is 8 percent and inflation is 4 percent. The nominal interest rate then rises to 12 percent and the inflation rate to 8 percent. It follows that the real rate of interest has

a. fallen. b. remained the same. c. risen to 8 percent. d. risen to 10 percent.