If the Nominal Interest Rate Is 4 Percent and the Real

question 23

Multiple Choice

If the nominal interest rate is 4 percent and the real interest rate is -2.5 percent,then the inflation rate is

• A)-6.5 percent.
• B)-1.5 percent.
• C)1.5 percent.
• D)6.5 percent.

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Definitions:

Professional Angels

Informal investors, often experienced entrepreneurs or executives, who provide capital for start-up businesses in exchange for ownership equity or convertible debt.

Doctors

Medical professionals who diagnose and treat illnesses, perform medical procedures, and advise patients on maintaining good health.

Lawyers

Professionals who practice law, offering advice, and representation to clients in legal matters.

Collateral

Assets pledged by a borrower to secure a loan or credit, which the lender can seize if the borrower fails to repay the agreed amount.