What Is a Credit Union

question 30

Multiple Choice

What is a credit union?

• A) A nonprofit depository institution that serves members who have a common affiliation
• B) A financial institution that accepts deposits and uses the funds to provide private business and personal loans
• C) A group of workers who pay union dues for credit
• D) A place where it snows

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Definitions:

Quantity Equation

The equation M × V = P × Y, which relates the quantity of money, the velocity of money, and the dollar value of the economy’s output of goods and services.

Real Interest Rate

The rate of interest an investor expects to receive after allowing for inflation, reflecting the true cost of borrowing and the true return on lending.

Nominal Interest Rate

The interest rate before taking inflation into account, representing the face value of interest payments on loans or investments.

Hyperinflation

An extremely high and typically accelerating rate of inflation, often causing a rapid erosion of the real value of local currency and leading to a collapse in a nation's monetary system.