If the Nominal Interest Rate Is Higher Than the Inflation

question 81

Multiple Choice

If the nominal interest rate is higher than the inflation rate, the value of your savings:

• A) will increase.
• B) will decrease.
• C) should remain about the same.
• D) cannot be determined without knowing its starting balance.

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Definitions:

Negative Growth

A decrease in the size or number of something, often used in the context of economies or populations shrinking.

Age Structure

The distribution of individuals among different ages in a population, usually depicted in a demographic pyramid.

AIDS

Acquired Immune Deficiency Syndrome (AIDS) is a life-threatening condition caused by the human immunodeficiency virus (HIV) that damages the immune system, hindering the body's ability to fight infections.

Zero Growth

A condition in which a population or economy is stable and does not increase or decrease significantly over time.