You Lend $5,000 to a Friend for One Year at a Nominal

Multiple Choice

You lend $5,000 to a friend for one year at a nominal interest rate of 10%.Inflation during that year is 5%.As a result, you will receive ________ at the end of the year, but that money has a purchasing power of ________.

A) $5,050; $5,025
B) $5,100; $5,050
C) $5,500; $5,250
D) $6,000; $5,500
E) $5,500; $6,000