What Is the Nominal Rate of Interest Given a Real

question 47

Multiple Choice

What is the nominal rate of interest given a real rate of interest of 5% and an inflation rate of 7%?

• A) 12.00%
• B) 2.00%
• C) 12.35%
• D) 1.90%

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Definitions:

Foot-In-The-Door Phenomenon

A principle in social psychology suggesting people are more likely to agree to a large request after first agreeing to a small, related request.

Peripheral Route Persuasion

A method of persuasion that relies on superficial cues, such as attractiveness or celebrity endorsement, to elicit a response without requiring deep processing of the message content.

Fundamental Attribution Error

The tendency to overemphasize personality traits and underestimate situational factors when explaining other people's behavior.

Role Playing

A method or technique for training, therapy, or entertainment in which participants act out roles in a narrative or scenario.