If the nominal interest rate on a one-year loan was 7%, the expected inflation rate over the year was 3% and the actual inflation rate over the year turned out to be 3.5%, then the expected real interest rate equals
A) 6.5%.
B) 4.0%.
C) 3.75%.
D) 3.5%.
B
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What curve shows the quantity of goods and services that firms choose to produce and sell at each price level?
Many financial instruments are standardized because:
A. it is believed that most parties to a contract do not read them anyway. B. the standardization of contracts makes them harder to understand. C. it is required by the government. D. complexity is costly, the more complex a contract, the more it costs to create.
Recall the Application about how marginal utility changes with the quantity consumed to answer the following question(s). Neuroscientists offered subjects in an experiment varying monetary rewards, and observed the neural activity in a subject's striatum region of the brain.Recall the Application. The results of the study mentioned in the Application lend support to:
A. the law of diminishing marginal utility of rewards. B. the law of supply. C. increasing marginal utility of rewards. D. the law of averages.
The most that someone would pay today to receive a certain sum at some point in the future is known as
A) the interest rate. B) present value. C) future value. D) economic profit.