You Put Money into an Account

question 155

Multiple Choice

You put money into an account. One year later you see that you have 5 percent more dollars and that your money will buy 6 percent more goods.

• A) The nominal interest rate was 11 percent and the inflation rate was 5 percent.
• B) The nominal interest rate was 6 percent and the inflation rate was 5 percent.
• C) The nominal interest rate was 5 percent and the inflation rate was −1 percent.
• D) None of the above is correct.

---

Definitions:

Section 12(a)(2)

A provision under the Securities Act of 1933 that provides a remedy for investors who have been sold securities by means of a prospectus or oral communication containing a material misstatement or omission.

Securities Act of 1933

A U.S. federal law enacted to require transparency in financial statements so investors can make informed decisions regarding securities investments; it also introduced regulations to prevent fraud.

Public Distribution

The system of distributing goods and services to the public through government channels, often at subsidized rates.

Privity of Contract

A legal principle indicating that only the parties involved in the contract have the rights and obligations under it.