If a lender charged a 4 percent nominal interest rate and the expected inflation rate is 1 percent, what is the difference between the real rate the lender received and the real rate the lender expected when actual inflation ended up being 1 percent?

a. 2 percent
b. 4 percent
c. -4 percent
d. 1 percent
e. 0 percent


E

Economics

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The profit maximizing condition for a firm in monopolistic competition is to produce so that

A) marginal cost equals marginal revenue. B) marginal cost equals price. C) average total cost equals price. D) price equals marginal revenue.

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Economics

Which price index measures the change in housing prices from repeated sales information?

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Economics