As Long as Prices Are Rising Over Time, Then

question 20

Multiple Choice

As long as prices are rising over time, then

• A)the nominal interest rate exceeds the real interest rate.
• B)the real interest rate exceeds the nominal interest rate.
• C)the real interest rate is positive.
• D)the nominal interest rate is a better indicator than the real interest rate of how fast the purchasing power of your bank account is changing over time.

---

Definitions:

Evolutionary Psychology

A theoretical approach in psychology that attempts to explain useful mental and psychological traits—such as memory, perception, or language—as adaptations, i.e., as the functional products of natural selection.

Earning Capacity

The maximum potential an individual has to earn money based on their skills, knowledge, and experience.

Gene-environment Interaction

The complex interplay between genetic predispositions and environmental factors that influence the development and expression of traits and behaviors.

Personality

The combination of characteristics or qualities that form an individual's distinctive character, influencing thoughts, motivations, and behaviors.