Solved

Which of the Following Is Not Correct

Question 5

Multiple Choice

Which of the following is not correct?


A) If the inflation rate exceeds the nominal interest rate,then the purchasing power of an interest-earning deposit falls over time.
B) If there is deflation,then the purchasing power of an interest-earning deposit rises by more than the nominal interest rate over time.
C) The higher the rate of inflation,the smaller the increase in the purchasing power of an interest-earning deposit.
D) The purchasing power of an interest-earning deposit can increase or decrease over time,but it cannot stay the same.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions