The Real Interest Rate Is 4 Percent a Year

question 133

Multiple Choice

The real interest rate is 4 percent a year. When the inflation rate is zero, the nominal interest rate is approximately percent a year; and when the inflation rate is 2 percent a year, the nominal interest rate is approximately percent a year.

• A) 4; 6
• B) 6; 8
• C) 0; 2
• D) 6; 4

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Definitions:

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A type of climate characterized by low precipitation levels, leading to desert landscapes and sparse vegetation.

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Variations of a chemical element that have the same number of protons but different numbers of neutrons in their nuclei.

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Rock formations dating back millions of years, often providing information on the Earth's geological and evolutionary history.

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Locations that provide archaeological evidence of human activity and habitation before recorded history or the advent of written language.