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Nominal Interest Rate
The interest rate as usually reported without a correction for the effects of inflation.
Real Interest Rate
The nominal interest rate adjusted for inflation, reflecting the true cost of borrowing or the true yield on an investment.
Inflation
The rate of growth in the average price of goods and services, which leads to a decline in the power of currency to buy goods.
Money-Supply Curve
A graphical representation showing the relationship between the quantity of money in the economy and the price level or interest rate.
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