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    Principles of Macroeconomics Study Set 8
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    Exam 17: Money Growth and Inflation: The Classical Theory of Inflation
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    If the Nominal Interest Rate Is 8 Percent and Expected
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If the Nominal Interest Rate Is 8 Percent and Expected

Question 55

Question 55

Multiple Choice

If the nominal interest rate is 8 percent and expected inflation is 2.5 percent,then what is the real interest rate?


A) 10.5 percent
B) 20 percent
C) 5.5 percent
D) 3.2 percent

Correct Answer:

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