The real interest rate is the:

A. the interest rate charged on a loan in dollar terms.
B. market interest rate.
C. annual percentage increase in the purchasing power of a financial asset.
D. annual percentage increase in the nominal value of a financial asset.


Answer: C

Economics

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In the above figure, at a price of $6, a perfectly competitive firm produces ________ and it ________

A) some output; incurs an economic loss B) 0; incurs an economic loss C) 0; does not incur an economic loss or make an economic profit D) 0; makes an economic profit

Economics

The aggregate demand curve differs from an individual demand curve in that

A) the aggregate demand curve may not slope down while an individual demand curve must always slope down. B) the aggregate demand curve looks at the entire circular flow of income and product, while an individual demand curve looks at one good, holding everything else constant. C) prices change along an individual demand curve but prices are held constant along an aggregate demand curve. D) the aggregate demand curve slopes up while an individual demand curve slopes down.

Economics

Refer to Table 10.2. If the price of output is $2 per unit and we observe the firm hiring four workers, if the firm is maximizing profit, the wage rate must be between ________ and ________.

A. $25; $45 B. $30; $35 C. $45; $60 D. $60; $80

Economics

A supply-side policy approach in Figure 8.3, given AD1 and AS1, to achieve both lower prices and more output would be to

A. Reduce marginal tax rates and government regulation in an effort to move AS1 to AS2 B. Increase aggregate spending. C. Increase the growth of the money supply. D. Wait until natural market forces establish full employment.

Economics