The Nominal Interest Rate Minus the Expected Rate of Inflation

question 99

Multiple Choice

The nominal interest rate minus the expected rate of inflation ________.

• A) defines the real rate of inflation
• B) is a worse measure of the incentives to borrow and lend than is the nominal interest rate
• C) is a more accurate indicator of the tightness of credit market conditions than is the nominal interest rate
• D) defines the bank rate

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Definitions:

Calvin Cycle

A series of biochemical redox reactions that take place in the stroma of chloroplasts in photosynthetic organisms.

Glycolysis

The process of breaking down glucose into pyruvate, yielding energy in the form of ATP, within cells under anaerobic or aerobic conditions.

Chemiosmosis

The movement of ions across a semipermeable membrane, down their concentration gradient, which is used to generate ATP in cells.

Membrane

A selective barrier that encloses the cell or organelles within a cell, controlling the movement of substances in and out.