What Would Happen to the Real Interest Rate If Originally

question 102

Multiple Choice

What would happen to the real interest rate if originally the nominal interest rate was 14% and the inflation rate was 10%, then the nominal interest rate fell to 7% as the inflation rate fell to 4%? It would go from:

• A)​24% to 11%.
• B)​11% to 24%.
• C)​4% to 3%.
• D)3% to 4%.

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