The Nominal Rate of Interest Is 2% and the Anticipated

question 116

Multiple Choice

The nominal rate of interest is 2% and the anticipated rate of inflation is 2%. What is the real rate of interest?

• A) 4%
• B) 2%
• C) -4%
• D) 0%

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Definitions:

Economies Of Scale

The cost advantage achieved by an increase in production, leading to a lower cost per unit.

Facilities

Physical locations or infrastructures where business operations occur, including offices, factories, and warehouses.

Distributors

Entities engaged in the business of distributing goods, typically bought from manufacturers, directly to retailers or customers.

Supply Chain

The entire process of making and selling commercial goods, including raw materials sourcing, manufacturing, distribution, and sales.