If a Depositor Puts Money in the Bank,the Interest Rate

question 35

Multiple Choice

If a depositor puts money in the bank,the interest rate that the bank will pay the depositor

• A) is the real rate of interest.
• B) is the nominal rate of interest.
• C) is the inflation-adjusted rate of interest.
• D) must by law equal the rate of inflation times the bank's risk premium.
• E) must by law equal the rate of inflation plus the bank's risk premium.

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Definitions:

Quasi-Contract

A legal concept that implies a contract exists to prevent unjust enrichment or unfair benefit, even though no formal contract exists between the parties.

Compensatory Damages

Financial compensation awarded to a plaintiff to cover losses directly related to an injury or damage.

Reliance Interest

Refers to the compensation aimed at putting a party in the position they would have been in had a contractual promise not been made.

Concurrent Condition

A situation in contract law where the obligations of parties are to be performed at the same time; the performance of one party is conditioned upon the performance by the other.