The Nominal Interest Rate Is 6

question 3

Multiple Choice

The nominal interest rate is 6%. The inflation rate is 3%. The exact real interest rate must be ________.

• A) 2.91%
• B) 3.85%
• C) 1.45%
• D) 2.12%

---

Definitions:

Engraving

A printmaking technique where an artist incises or cuts an image into a hard surface, traditionally metal, to create a design.

Lord North

Frederick North, 2nd Earl of Guilford, known as Lord North, was the Prime Minister of Great Britain from 1770 to 1782 during a significant portion of the American Revolutionary War.

Townshend Duties

A series of British acts in the late 1760s imposing duties on the colonies for goods such as tea, glass, and paper, contributing to growing American discontent and the Revolutionary War.

Supremacy of Parliament

A doctrine in constitutional law that holds the legislative body as the supreme form of authority within the state, with its acts not subject to judicial review or challenge.