Which of the Following Holds That the General Level of Nominal

question 47

Multiple Choice

Which of the following holds that the general level of nominal interest rates follows the general level of inflation?

• A)market rate theory
• B)market yield theory
• C)Fisher hypothesis
• D)expectations theory
• E)rational rate hypothesis

---

Definitions:

Stocks

Shares of ownership in a company, which represent a claim on the company's earnings and assets.

Investment

Applying resources, typically financial, in order to gain income or profit.

Portfolio

An aggregation of financial instruments such as company shares, debt securities, tangible commodities, available cash, and cash-like resources, including mutual funds and ETFs.

Perfectly Positively Correlated

A situation where two variables move in the same direction at the same rate, represented by a correlation coefficient of +1.