Trends and Fluctuations in Nominal Interest Rates

question 76

Multiple Choice

Trends and fluctuations in nominal interest rates

• A)are closely connected with real GDP and the rate of inflation.
• B)are not closely connected with any economic variable.
• C)are closely connected with real GDP and not with the rate of inflation.
• D)are closely connected only with trends and fluctuations in the rate of inflation.
• E)depend on the exchange rate.

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Definitions:

Mutual Funds

Investment programs funded by shareholders that trade in diversified holdings and are professionally managed.

Exchange-Traded Funds

Investment funds that are tradeable on stock exchanges, similar to stocks, and hold assets such as stocks, commodities, or bonds.

Contagion

A pattern in which stock markets have become increasingly interconnected around the world and markets in different countries have begun reacting similarly.

Net Present Value

A financial metric that calculates the present value of net cash flows (inflows minus outflows) over a period, used for assessing the profitability of an investment.