Which of the Following Statements Is False

question 52

Multiple Choice

Which of the following statements is false?

• A)Nominal interest rate can be either positive,zero,or negative.
• B)The expected real interest rate can be either positive,zero,or negative.
• C)The expected real interest rate is the correct interest rate to use for studying people's decisions about how much to borrow or lend.
• D)Nominal interest rate must exceed the expected real interest rate as long as there is a positive expected inflation rate.

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