You Want to Make a 10% Real Return on a Loan

question 228

Multiple Choice

You want to make a 10% real return on a loan that you are planning to make, and the expected inflation rate during the period of the loan is 10%. You should charge a nominal interest rate of

• A) 0%.
• B) 5%.
• C) 10%.
• D) 20%.

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Definitions:

Scribbles

Early forms of writing and drawing by young children that typically lack form and are exploratory in nature, preceding more purposeful drawing and writing.

Border

The line or boundary that separates two areas, countries, or objects.

Proximodistal Trend

A pattern of growth and development in children where development proceeds from the center of the body outward towards the extremities.

Fine Motor Skills

Fine motor skills involve the coordination of small muscles in movements usually involving the synchronization of hands and fingers with the eyes.