If the Current Inflation Rate Is 3

question 58

Multiple Choice

If the current inflation rate is 3.6% and you have an investment opportunity that pays 10.9%, then the real rate of interest on your investment is closest to ________.

• A) 8.5%
• B) 9.9%
• C) 11.3%
• D) 7.0%

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Definitions:

Volumetric Efficiency

The ratio of air drawn into a cylinder compared to the maximum air that could enter the cylinder. Most gas engines are about 80 to 90 percent volumetrically efficient.

Air Drawn

The process of pulling air into a system, such as an engine or ventilation system, from the surroundings.

Cylinder

A fundamental part of an engine's block that houses the pistons, where fuel combustion occurs to generate power.

Drive-By-Wire Throttle

An electronic throttle control system that uses electronic signals to control the throttle opening instead of mechanical linkage.