If You as a Lender Want an Increase in Purchasing

question 51

Multiple Choice

If you as a lender want an increase in purchasing power of 4 percent from making a loan and you set the nominal interest rate at 9 percent, then your

• A)real rate of interest is 13 percent.
• B)expected rate of inflation is 5 percent.
• C)expected rate of inflation is 13 percent.
• D)real rate of interest is 36 percent.

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Definitions:

Intersection

A point where two or more roads meet or cross each other.

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An electronic device designed to record and store audio or video signals digitally for later playback or processing.

Interviewee

A person who answers questions during an interview, typically the one being interviewed.

Interviewer

A person who asks questions to another individual, known as the interviewee, in a formal or informal setting, often for the purpose of gathering information, evaluating qualifications, or for media publication.