The Real Interest Rate Is

question 124

Multiple Choice

The real interest rate is:

• A) the everyday notion of the interest rate.
• B) adjusted for inflation.
• C) the amount of interest the bank pays you for saving or charges you for borrowing.
• D) the actual average interest rate in the economy.

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Definitions:

Conservation

In psychology, the concept that a child recognizes that quantity does not change with physical rearrangement; in environmental science, the protection of natural resources.

Public Commitments

Decisions or promises made in a public setting, which are more likely to be upheld due to the added pressure of social accountability.

Prompts

Cues that convey a message and remind people to do something.

Hypocrisy Induction

A technique for effecting behavior change by confronting people with the inconsistency between their attitudes and their behavior.