In Which Case Below Is the Real Interest Rate the Highest

question 242

Multiple Choice

In which case below is the real interest rate the highest?

• A)the nominal interest rate = 1% and inflation = 3%
• B)the nominal interest rate = 6% and inflation = 4%
• C)the nominal interest rate = 2% and inflation = -1%
• D)the nominal interest rate = 2% and inflation = 1%

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