Multiple Choice
If you as a lender want an increase in purchasing power of 4 percent from making a loan and you set the nominal interest rate at 9 percent, then your
A) real rate of interest is 13 percent.
B) expected rate of inflation is 5 percent.
C) expected rate of inflation is 13 percent.
D) real rate of interest is 36 percent.
Correct Answer:
Verified
Correct Answer:
Verified
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