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When price is the rationing criterion, individuals have a strong incentive to
Real Interest Rate
The rate of interest an investor expects to receive after allowing for inflation, reflecting the true cost of borrowing.
Nominal Interest Rate
The interest rate before adjusting for inflation; the stated interest rate of a given bond or loan.
Price Level
A measure of the average prices of goods and services in an economy, which can affect purchasing power and inflation.
Inflation
The speed at which overall prices for products and services increase, leading to a decline in buying power.
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