Which of the Following Statements Is True

question 13

Multiple Choice

Which of the following statements is true?

• A)The real interest rate matters more to borrowers than the nominal interest rate.
• B)The nominal interest rate is equal to the real interest rate minus the expected inflation rate.
• C)If there is expected deflation (expected decline in the price level), instead of expected inflation, the nominal interest rate will be greater than the real interest rate.
• D)The nominal interest rate is determined by the demand for credit and the supply of credit, or by the demand for loanable funds and the supply of loanable funds.
• E)If there is expected deflation, the nominal interest rate will necessarily be negative.

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Definitions:

Deport Foreigners

The act of expelling individuals who are not citizens from a country, usually for violating immigration laws or posing a threat to national security.

W.E.B. DuBois

An African American sociologist, historian, civil rights activist, and author who co-founded the National Association for the Advancement of Colored People (NAACP) in 1909.

Color Line

Describes the segregation or division between racial groups, particularly between blacks and whites in the United States.

Isthmian Canal

Refers to the Panama Canal, a man-made waterway connecting the Atlantic and Pacific Oceans through the Isthmus of Panama, completed in 1914.