If the Nominal Interest Rate Is 8 Percent and Expected

question 55

Multiple Choice

If the nominal interest rate is 8 percent and expected inflation is 2.5 percent,then what is the real interest rate?

• A)10.5 percent
• B)20 percent
• C)5.5 percent
• D)3.2 percent

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Definitions:

Explicit Motives

Conscious motivations, usually measured by self-report.

Affiliation Motive

A psychological drive that influences an individual's need to form or maintain positive social relationships and connections.

Achievement Motive

A psychological construct that refers to an individual's desire to achieve success and demonstrate competence.

Achievement Motivation

A psychological factor that drives individuals to seek success and accomplishment in their endeavors.