Multiple Choice
Suppose the nominal interest rate was 5 percent and the inflation rate was 3.5 percent.
A) The dollar value of savings increased at 1.5 percent, and the value of savings measured in goods increased at 3.5 percent.
B) The dollar value of savings increased at 3.5 percent, and the value of savings measured in goods increased at 1.5 percent.
C) The dollar value of savings increased at 3.5 percent, and the value of savings measured in goods increased at 5 percent.
D) The dollar value of savings increased at 5 percent, and the value of savings measured in goods increased at 1.5 percent.
Correct Answer:
Verified
Correct Answer:
Verified
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