Consider the Situations of a Lender of Money and a Borrower

question 73

Multiple Choice

Consider the situations of a lender of money and a borrower of money.Which of the following situations is least burdensome for the borrower?

• A)nominal interest rate of 15% and an inflation rate of 8%
• B)nominal interest rate of 10% and an inflation rate of 1%
• C)nominal interest rate of 8% and an inflation rate of 2%
• D)nominal interest rate of 4% and an inflation rate of 4%
• E)nominal interest rate of 29% and an inflation rate of 21%

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Definitions:

Efficiency

The ability to accomplish a job with a minimum expenditure of time and resources.

Hydraulic Fracturing

A method used to extract underground resources like oil and natural gas by injecting fluid into the ground at high pressure.

Environmental Groups

Organizations focused on advocating for the protection of the environment and promoting awareness of environmental issues.

Social Pressures

The influence that is exerted on individuals or groups by society, encouraging them to conform to societal norms and expectations.