Suppose That Over the Past Year,the Real Interest Rate Was

question 117

Multiple Choice

Suppose that over the past year,the real interest rate was 5 percent and the inflation rate was 3 percent.It follows that

• A)the dollar value of savings increased at 5 percent,and the purchasing power of savings increased at 2 percent.
• B)the dollar value of savings increased at 5 percent,and the purchasing power of savings increased at 8 percent.
• C)the dollar value of savings increased at 8 percent,and the purchasing power of savings increased at 2 percent.
• D)the dollar value of savings increased at 8 percent,and the purchasing power of savings increased at 5 percent.

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Definitions:

Financial Projections

Estimates of a company's future financial performance, including income, expenses, and cash flow.

Chain of Command

The hierarchy within an organization that establishes the authority and responsibility relationships among employees.

Fastest Growth

The highest rate of expansion in size, production, or market share experienced by an entity over a specific period.

Corporate Joint Ventures

A strategic alliance between two or more businesses that agree to share resources, risks, and rewards to pursue common objectives.