Assume That in 2016,prices Increased by 2% Over the Previous

question 173

Multiple Choice

Assume that in 2016,prices increased by 2% over the previous year and the nominal rate of interest was 8%.In 2017,prices increased by 5%.If the real rate of interest is to remain at the same level in 2017 as it was in 2016,then what should the nominal interest rate in 2017 be?

• A)0%
• B)11%
• C)13%
• D)14%
• E)20%

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Definitions:

Habit

A regular practice or routine that is hard to give up, often performed unconsciously.

Power And Influence

The ability of an individual or group to affect or change the behavior, opinions, or course of events.

Change Management

The process, tools, and techniques used to manage the people side of change to achieve a required business outcome.

Energizing Commitment

Stimulating a strong dedication or allegiance towards a goal, project, or cause.