Darius Lent Alejandro $1,000 for One Year with the Understanding

question 98

Multiple Choice

Darius lent Alejandro $1,000 for one year with the understanding that Alejandro would repay $1,070. If the actual inflation rate was 7 percent, what was the real rate of interest Darius received?

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

---

Definitions:

21st Century

The current century, beginning January 1, 2001, and ending December 31, 2100, marked by rapid technological advancements and globalization.

Resurgence

The revival or renewal of activity, interest, or strength after a period of decline or dormancy.

Labor-Management Relations

The interactions between employees, often represented by unions, and employers regarding working conditions, pay, and other aspects of work.

Concession Bargaining

A negotiation process where labor unions agree to give up previous benefits in exchange for something else, often to avoid worse outcomes.