Which of the Following Must Occur for the Nominal Interest

Multiple Choice

Which of the following must occur for the nominal interest rate to be equal to the real interest rate?

A) Expected inflation is equal to the nominal interest rate.
B) Expected inflation is equal to the real interest rate.
C) The nominal and real interest rates can never be equal.
D) Expected inflation is equal to zero.
E) Expected inflation is equal to twice the real interest rate.