Suppose That, Initially, the Nominal Interest Rate Is 6 Percent

question 196

Multiple Choice

Suppose that, initially, the nominal interest rate is 6 percent and the inflation rate is 3 percent. If the inflation rate increases to 6 percent, what will be the new nominal interest rate?

• A) 6 percent
• B) 11 percent
• C) 1 percent
• D) 9 percent

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Definitions:

Persuasion Strategies

Persuasion strategies are techniques designed to change the beliefs, attitudes, or behaviors of others in a particular direction.

Cognitive Dissonance

A psychological phenomenon involving discomfort felt at conflicting beliefs, values, or attitudes, leading to an alteration in one of the conflicting factors.

Door-in-the-face Technique

A persuasion strategy where a large, likely-to-be-rejected request is followed by a smaller, more reasonable request.

Election Sign

A physical marker or poster designed to promote or indicate support for a particular candidate or political position during electoral campaigns.