If the Nominal Interest Rate Is 5 Percent and the Real

question 45

Multiple Choice

If the nominal interest rate is 5 percent and the real interest rate is 7 percent, then the inflation rate is

• A)−2 percent.
• B)0.4 percent.
• C)2 percent.
• D)12 percent.

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Definitions:

Commercial Rents

Payments made for the use of commercial property, such as offices, shops, or industrial spaces.

Destination Contract

A contract specifying that the seller is responsible for delivering goods to a specific location, with the risk of loss transferring upon delivery.

Shipment Contract

An agreement where the seller is obligated to transport goods to a specific destination, with title and risk of loss passing to the buyer upon delivery to a carrier.

Bill Of Lading

An official document issued by a carrier to acknowledge receipt of cargo for shipment, acting as a contract between the owner of the goods and the carrier.