Let $r$ Denote the Real Interest Rate and I Denote the Nominal

question 46

Multiple Choice

Let $r$ denote the real interest rate and i denote the nominal interest rate; these two interest rates are related by:

• A) \(i = \pi\)
• B) \(i = r - \pi\)
• C) \(i = r + \pi\)
• D) \(i = r / \pi\)
• E) None of these answers are correct.

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Definitions:

Milliliter

A unit of volume in the metric system, equivalent to one-thousandth of a liter.

Gram

An alternative definition: A basic unit of weight in the metric system equivalent to approximately 0.035 ounces.

Milliliters

A metric system volume unit that equals one thousandth of a liter.

Liters

A unit of volume in the metric system, equivalent to 1,000 cubic centimeters or approximately 0.26 gallons.