Data on Real and Nominal Interest Rates of Ten- Year

question 43

Multiple Choice

Data on real and nominal interest rates of ten- year Australian T- Bond show that, over the past forty years:

• A) the real rate has always been less than the nominal rate.
• B) the nominal rate has always been less than the real rate.
• C) the nominal rate has varied, but the real rate has not.
• D) the real rate has varied, but the nominal rate has not.
• E) whenever the nominal rate rises, the real rate falls, and vice versa.