The Consumer Price Index Was 200 in 2008 and 190

question 51

Multiple Choice

The consumer price index was 200 in 2008 and 190 in 2009.The nominal interest rate during this period was 4.5 percent.What was the real interest rate during this period?

• A)- 0.75 percent
• B)- 0.5 percent
• C)9.5 percent
• D)9.75 percent

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Definitions:

Eurodollar Transactions

Financial transactions involving U.S. dollars deposited in banks outside the United States, often used in international lending and finance.

Exchange Rate

The value of one currency for the purpose of conversion to another, indicating how much one currency is worth in terms of the other.

Supply And Demand

Economic model of price determination in a market, where the quantity of a good supplied by producers and the quantity demanded by consumers depend on the price level.

Currencies

Systems of money in common use, particularly in a nation or economic region, serving as a medium of exchange.