Which One of the Following Is Correct Concerning Real Interest

question 40

Multiple Choice

Which one of the following is correct concerning real interest rates?

• A)real interest rates are constant.
• B)real interest rates must be positive.
• C)real interest rates must be less than nominal interest rates.
• D)real interest rates, if positive, increase purchasing power over time.

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Definitions:

Intangible Assets

Assets that lack physical substance, such as patents, trademarks, and goodwill.

Physical Substance

The material form or physical presence of an asset, distinguishing tangible assets from intangible ones.

Market Forces

The natural dynamics of supply and demand that determine the prices and availability of goods and services in an economy without external influences.

Comparisons

The act or instance of examining the similarities and differences between two or more items.