Multiple Choice
An investor requires a 3 percent increase in purchasing power in order to induce her to lend. She expects inflation to be 2 percent next year. The nominal rate she must charge is about
A) 3 percent.
B) 2 percent.
C) 1 percent.
D) 5 percent.
E) 7 percent.
Correct Answer:
Verified
Correct Answer:
Verified
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