You want to make a 10% real return on a loan that you are planning to make, and the expected inflation rate during the period of the loan is 10%. You should charge a nominal interest rate of
A. 0%.
B. 5%.
C. 10%.
D. 20%.
Answer: D
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If the demand for jelly increases, and the price of grapes (used to make jelly) rises
A) the equilibrium quantity of jelly falls and the equilibrium price of jelly might rise or fall. B) the equilibrium price of jelly falls and the equilibrium quantity of jelly might rise or fall. C) the equilibrium price of jelly rises and the equilibrium quantity of jelly might rise or fall. D) the equilibrium price of jelly falls and the equilibrium quantity of jelly rises.
Which of the following is NOT an example of buyer interaction that may improve the effectiveness of monopsony power?
A) Professional sports leagues that coordinate salary structures for players across the teams. B) A buying cooperative in which members pool their purchases into one large order. C) Labor unions that negotiate wage contracts for many workers who are employed by one firm. D) All of the above are examples of buyer interaction in monopsonistic markets.
In the early ________, computers became powerful enough to have a real economic impact.
A. 1970s B. 1990s C. 1980s D. 2000s
In the short run, if the marginal product is at its maximum, then the
A) average cost is at its minimum. B) average variable cost is at its minimum. C) marginal cost is at its minimum. D) total cost is at its maximum.