Which of the Following Must Occur for the Nominal Interest

question 13

Multiple Choice

Which of the following must occur for the nominal interest rate to be equal to the real interest rate?

• A) Expected inflation is equal to the nominal interest rate.
• B) Expected inflation is equal to the real interest rate.
• C) The nominal and real interest rates can never be equal.
• D) Expected inflation is equal to zero.
• E) Expected inflation is equal to twice the real interest rate.

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Definitions:

Antipyretics

Medications or substances that reduce fever by lowering the body temperature from a raised state.

Bacteria

Microscopic, single-celled organisms found almost everywhere, which can be beneficial, neutral, or harmful to humans and other organisms.

Febrile Seizures

Seizures that occur in a young child with a fever, typically without any brain or spinal cord infection or injury.

Antibiotics

Medications used to prevent and treat bacterial infections by killing or inhibiting the growth of bacteria.