If Two Parties to a Loan Contract Agree That the Lender

question 50

Multiple Choice

If two parties to a loan contract agree that the lender should earn an 8 percent increase in purchasing power as a result of a loan and if the inflation rate is 5 percent,the nominal interest rate is _____.

• A)13 percent
• B)8 percent
• C)5 percent
• D)3 percent
• E)1 percent

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Definitions:

Protect Themselves

Actions or measures taken by individuals or entities to safeguard against harm or danger.

Receiver

In communication, the individual or group who receives and interprets the message sent by the sender.

Sender

In communication, the sender is the individual or entity that initiates a message or information to be communicated to others.

Nonverbal Messages

Communication cues transmitted without words, such as gestures, facial expressions, and body language.