Marquis Borrowed $1,000 from Ayana for a Year and Agreed

question 194

Multiple Choice

Marquis borrowed $1,000 from Ayana for a year and agreed to repay her $1,050 at the end of the year. If the inflation rate was 3 percent, what is the real rate of interest Ayana received?

• A)10 percent
• B)5 percent
• C)3 percent
• D)2 percent
• E)-2 percent

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Definitions:

General Adaptation Syndrome

A theoretical model describing the body's short-term and long-term reactions to stress, consisting of three stages: alarm, resistance, and exhaustion.

Hormones

Chemical messengers that are produced by the endocrine glands and carried by the bloodstream to all parts of the body.

Hypothalamic-Pituitary-Adrenal Axis

A complex set of interactions among the hypothalamus, pituitary gland, and adrenal glands, regulating stress response.

Chronic Stress

A persistent state of stress that can lead to long-term health problems, including anxiety, depression, and cardiovascular disease.