Suppose the Annual Nominal Interest Rate Is 7 Percent and the Inflation

question 99

Multiple Choice

Suppose the annual nominal interest rate is 7 percent and the inflation rate is 7 percent. If you deposit $1,000, at the end of the year:

• A) your purchasing power will have increased.
• B) your purchasing power will have stayed the same.
• C) your savings will have a nominal decrease.
• D) your purchasing power will have decreased.

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Definitions:

Higher Frequencies

Electromagnetic wavelengths that are shorter, resulting in greater oscillations per second, which are applied in various technologies like microwave and radio.

Semicircular Canals

Structures within the inner ear that are key to the vestibular system, helping maintain balance and spatial orientation.

Ampulla

A dilated section of a canal or duct, such as the ampulla of Vater in the digestive system, which aids in the digestion process by releasing bile and pancreatic juices into the small intestine.

Ossicles

The three small bones in the middle ear called the malleus, incus, and stapes, which help in transmitting sound vibrations to the inner ear.