If the real interest rate is 6.8% and the inflation rate is 3.9%, what is the nominal interest rate?
The nominal interest rate is 10.7%.
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Suppose real GDP is $12.1 trillion and potential GDP is $12.6 trillion. To move the economy back to potential GDP, Congress should
A) lower government purchases by $500 billion. B) raise government purchases by $500 billion. C) raise government purchases by more than $500 billion. D) lower taxes by an amount less than $500 billion. E) lower taxes by $500 billion.
If the quantity of jelly beans supplied is represented by the equation QS = -20 + 4P then the corresponding price of jelly beans is represented by the equation
A) P = 2.5 - 4QS. B) P = 0.25QS + 5. C) P = 4QS - 80. D) P = 0.5QS + 80.
If a price floor of $23 were placed in the market in the graph shown:
A. a surplus of 27 would occur.
B. a surplus of 37 would occur.
C. a surplus of 10 would occur.
D. a surplus of 20 would occur.
Recall the illustration in the text where Y = $700 billion, consumers spend $620 billion on consumption goods, and producers make only $600 billion of consumption goods. David Tietlebaum's Poster and Frame store, a representative retail store, is directly affected by this situation. Which of the following does not happen to David?
a. David discovers that the inventories he wants to hold will be reduced. b. David will reorder greater quantities of posters and frames. c. David will sell some of the goods he had expected to hold as investment. d. David will need to restock depleted inventories. e. David will find that his actual investment is greater than intended investment.