If the Real Interest Rate Is 4 Percent and the Inflation

question 43

Multiple Choice

If the real interest rate is 4 percent and the inflation rate is 3 percent, the nominal interest rate is approximately

• A) 7 percent.
• B) 12 percent.
• C) 1.33 percent.
• D) 1 percent.

---

Definitions:

Late Majority

A segment of consumers in the diffusion of innovation model, who adopt new products or technologies after the average consumer.

Innovator

An individual or organization that introduces new ideas, products, or methods, often leading changes in market trends or technological advancements.

Early Adopter

An individual or group who uses or purchases new products, services, or technologies soon after their launch, often leading trends and influencing later adopters.

Product Life Cycle

The sequence of stages from introduction to growth, maturity, and decline that a product goes through in the market.