Suppose the Nominal Annual Interest Rate on a Two-Year Loan

question 130

Multiple Choice

Suppose the nominal annual interest rate on a two-year loan is 8 percent and lenders expect inflation to be 5 percent in each of the two years. The annual real rate of interest is

• A) 6 percent.
• B) 8 percent.
• C) 2 percent.
• D) 3 percent.

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Definitions:

Gender Role

Roles, actions, and traits that society deems suitable for males and females, built on social norms and expectations.

Heteronormativity

Is the belief that sex is binary (one is either male or female as conventionally understood), that sex ought to be perfectly aligned with gender, and that sexual relations are appropriate only between people of the opposite sex.

Social Assumption

Preconceived notions or generalized beliefs held by individuals about other people, groups, or societal norms, often without supportive evidence or personal experience.

Genitalia

The external and internal organs of the reproductive system in animals and humans.