The Natural Rate of Interest Is

question 55

Multiple Choice

The natural rate of interest is

• A) the nominal rate of interest.
• B) the market-clearing interest rate.
• C) the real interest rate when wages and prices are fixed.
• D) the real interest rate minus the expected inflation rate.
• E) the Bank of Canada's target interest rate.

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Definitions:

Pomegranates

A fruit with a tough outer layer that contains sweet-tart arils, which are edible seeds surrounded by juicy pulp.

Bananas

A type of elongated, edible fruit produced by various kinds of large herbaceous flowering plants in the genus Musa.

Principle Of Diminishing Marginal Utility

The proposition that each successive unit of a good or service consumed adds less to total utility than did the previous unit.

Marginal Utility

The augmented utility or satisfaction a consumer experiences when they consume one more unit of a product or service.