Jennifer Took Out a Fixed-Interest-Rate Loan When the CPI Was

question 24

Multiple Choice

Jennifer took out a fixed-interest-rate loan when the CPI was 100.She expected the CPI to increase to 103 but it actually increased to 105.The real interest rate she paid is

• A)higher than she had expected,and the real value of the loan is higher than she had expected.
• B)higher than she had expected,and the real value of the loan is lower than she had expected.
• C)lower than she had expected,and the real value of the loan is higher than she had expected.
• D)lower then she had expected,and the real value of the loan is lower than she had expected.

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Definitions:

Sperm

Male reproductive cells or gametes in sexually reproducing organisms, involved in fertilizing the ovum to initiate pregnancy.

Chromosomes

Thread-like structures located inside the nucleus of animal and plant cells, made of protein and a single molecule of deoxyribonucleic acid (DNA), responsible for carrying genetic information.

Genes

The basic units of heredity in living organisms, made up of DNA, that carry instructions for the development, functioning, growth, and reproduction of all known living organisms.

Homozygous

A genetic condition where an individual has two identical alleles for a particular gene or trait.