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    If the Nominal Interest Rate Is 5 Percent and the Rate
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If the Nominal Interest Rate Is 5 Percent and the Rate

Question 256

Question 256

Multiple Choice

If the nominal interest rate is 5 percent and the rate of inflation is 2 percent, then the real interest rate is


A) 7 percent.
B) 3 percent.
C) 2.5 percent.
D) .4 percent.

Correct Answer:

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