For a Given Real Interest Rate,a Decrease in the Inflation

question 57

Multiple Choice

For a given real interest rate,a decrease in the inflation rate would

• A)decrease the after-tax real interest rate and so decrease saving.
• B)decrease the after-tax real interest rate and so increase saving.
• C)increase the after-tax real interest rate and so decrease saving.
• D)increase the after-tax real interest rate and so increase saving.

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Definitions:

Contingency Table

A type of table used in statistics to summarize the relationship between several categorical variables, showing the frequencies at which certain combinations of variables occur.

Two-tail Test

A statistical test that determines if there are any significant differences between two population means or parameters, checking for deviations in two opposite directions from the null hypothesis.

Population Proportion

A statistic that represents the fraction of the population that has a particular characteristic or attribute.

Chi-squared Test

A statistical test used to determine the likelihood of an observed distribution of data differing from a theoretical distribution.