If You Borrow Money at a Nominal Interest Rate of 5

question 104

Multiple Choice

If you borrow money at a nominal interest rate of 5 percent and the inflation rate is 10 percent,what real interest rate will you pay?

• A) -5 percent
• B) 0.5 percent
• C) 2 percent
• D) 5 percent
• E) 10 percent

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