You Notice That When the Inflation Rate Increases, the Interest

question 363

Multiple Choice

You notice that when the inflation rate increases, the interest rate tends to increase. This observation indicates that

• A) the variables have an inverse relationship.
• B) higher inflation rates must cause a higher interest rate.
• C) a scatter diagram of the inflation rate and the interest rate will show a positive relationship.
• D) there might be false causality between inflation and the interest rate.

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Definitions:

Percent

A way of expressing a number as a fraction of 100.

Experienced

Having practical knowledge or skill in a particular area through direct involvement or participation.

Androgyny

A gender expression that includes a combination of masculine and feminine characteristics.

Self-Confident

The belief in one's own abilities, qualities, and judgment, reflecting a positive view of oneself.