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:

Aposematic Coloration

The conspicuous coloring of a poisonous or distasteful organism that enables potential predators to easily see and recognize it. Also called warning coloration. Compare with cryptic coloration.

Habituation

A simple form of learning where an organism eventually stops responding to a stimulus after repeated exposures, without any reward or punishment.

Worker Bees

Female bees that are not queens and perform all the work tasks necessary for colony survival.

Male

Referring to the sex that produces small, mobile gametes (sperm) in sexually reproducing species, typically associated with XY chromosome configuration in mammals.