The Real Interest Rate Is 4 Per Cent a Year

question 10

Multiple Choice

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

• A)0; 2
• B)6; 4
• C)6; 8
• D)4; 6

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Definitions:

Federal Judges

Jurists appointed to serve on the federal courts of the United States, including the Supreme Court, Courts of Appeal, and District Courts.

Jimmy Carter

The 39th President of the United States (1977-1981) known for his commitment to peace and human rights.

Majority Opinion

In judicial terms, an opinion that reflects the views of the majority of judges or justices hearing a case, establishing the decision as the court's judgment.

District Court

A type of trial court where cases are initially argued and decided, typically involving federal or state laws.