The Market Interest Rate in Alpha Is 7% and the Market

question 96

Multiple Choice

The market interest rate in Alpha is 7% and the market interest rate in Beta is 10%,but the inflation rate in Alpha is 3% and inflation rate in Beta is 8%.Which of the following statements is true?

• A) The real interest rate is higher in Alpha,but the nominal interest rate is higher in Beta.
• B) The real interest rate is lower in Alpha,but the nominal interest rate is lower in Beta.
• C) Both the real and nominal interest rates are higher in Alpha.
• D) Both the real and nominal interest rates are higher in Beta.
• E) The real and nominal interest rates are the same in Alpha and Beta.

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Definitions:

Phallic Stage

A stage in Freudian psychosexual development, typically around ages three to six, where the focus of libido (sexual energy) is on the genital area.

Freud

Sigmund Freud was an Austrian neurologist who founded psychoanalysis, a method for treating psychopathology through dialogue between a patient and a psychoanalyst.

Competitive

Having a strong desire to compete or strive for superiority, often in sports, business, or other areas.

Anal Stage

A phase in Freudian psychosexual development centered around a child's experience with anal retention or expulsion, typically occurring between 18 months and 3 years of age.