A lender is expecting a return of 8 percent on a sum of money that will mature in 2017 . If the average price level increases by 5 percent in 2017, his real rate of return will be _____
a. 3 percent
b. 5 percent
c. 13 percent
d. 2 percent
a
You might also like to view...
When the monetary base increases by $4 billion, the quantity of money increases by $10 billion. Thus, the money multiplier equals
A) 0.4. B) 2.5. C) 40.0. D) none of the above.
Which investment bank avoided bankruptcy by being purchased by JP Morgan Chase in March 2008?
A) Morgan Stanley B) Lehman Brothers C) Bear Stearns D) Merrill Lynch
According to Keynes,
A. supply creates its own demand. B. the problem during recessions was inadequate aggregate supply. C. investment spending was necessary to get us out of a depression. D. budget deficits were good during recessions.
In the early 2000s, some argued that the Indian government impeded foreign investment with tariffs, investment caps, and tons of red tape. In terms of promoting or retarding economic growth, such policies:
A. increase growth because they keep people producing for the local market. B. decrease growth because they slow the growth of capital. C. increase growth because they stop exploitation by foreigners. D. decrease growth because they cause inflation.