Which of the Following Statements Is Correct About the Relationship

Multiple Choice

Which of the following statements is correct about the relationship between inflation and interest rates?

A) There is no relationship between inflation and interest rates.
B) The interest rate is determined by the rate of inflation.
C) In order to fully understand inflation, we need to know how to correct for the effects of interest rates.
D) In order to fully understand interest rates, we need to know how to correct for the effects of inflation.