A Difference Between an Interval Scale and a Ratio Scale

question 5

Multiple Choice

A difference between an interval scale and a ratio scale is

• A) an interval scale has equal intervals;a ratio scale does not.
• B) a ratio scale has equal intervals;an interval scale does not.
• C) an interval scale has an absolute zero point;a ratio scale does not.
• D) a ratio scale has an absolute zero point;an interval scale does not.

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Definitions:

Loanable Funds

Financial resources available for borrowing, often within the context of a market setting interest rates.

Time Preference

The degree to which individuals prefer to receive goods, services, or returns on investments sooner rather than later.

Expected Inflation

The rate at which the general level of prices for goods and services is projected to rise over a specific period, influencing economic decisions.

Real Interest Rate

The rate of interest an investor, saver, or lender receives (or expects to receive) after allowing for inflation.