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What is most likely to happen in the short run?
Real Interest Rate
The interest rate that accounts for inflation, reflecting the actual cost of borrowing and the real return on savings.
Inflation Rate
The level of acceleration in the overall pricing of goods and services, resulting in a decline in buying efficiency.
Nominal Interest Rate
The rate of interest before adjusting for inflation, representing the face value of interest payments made on savings or loans.
Real Interest Rate
The interest rate adjusted for inflation, representing the real cost of borrowing and the real yield to lenders.
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