Tony Lent Dave $1,000 for One Year with the Understanding

question 98

Multiple Choice

Tony lent Dave $1,000 for one year with the understanding that Dave would repay $1,070.If the actual inflation rate was 7 percent,then the real rate of interest Tony received is _____.

• A)14 percent
• B)7 percent
• C)4 percent
• D)0 percent
• E)−7 percent

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Definitions:

Name Recognition

Name recognition refers to the public's ability to recall and recognize a brand or company by its name, indicating a level of familiarity or prestige in the market.

Unlimited Financial Liability

A legal obligation where business owners are personally responsible for all the debts of their business, without any limit.

Partnerships

A legal arrangement where two or more parties collaborate in managing and operating a business.

Life Insurance

A type of insurance that protects people against the financial losses that occur with premature death.