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    Macroeconomics Study Set 39
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    Exam 5: Inflation: Its Causes, Effects, and Social Costs
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    If the Nominal Interest Rate Is 1 Percent and the Inflation
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If the Nominal Interest Rate Is 1 Percent and the Inflation

Question 46

Question 46

Multiple Choice

If the nominal interest rate is 1 percent and the inflation rate is 5 percent, the real interest rate is:


A) 1 percent.
B) 6 percent.
C) -4 percent.
D) -5 percent.

Correct Answer:

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