If the Real Rate of Return Is 5 Percent, and the Inflation

question 54

Multiple Choice

If the real rate of return is 5 percent, and the inflation rate is 2 percent, then the nominal interest rate must be:

• A) 7 percent.
• B) 3 percent.
• C) −3 percent.
• D) −7 percent.

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Definitions:

Instincts

Instincts refer to inherent inclinations towards a particular behavior or action, typically aimed at survival or reproduction, as proposed in various psychological and biological theories.

Extraverts

Individuals who are outgoing, sociable, and inclined towards seeking stimulation in the external environment.

Happier

A comparative state of experiencing greater joy or contentment.

Introverts

Introverts are individuals who tend to prefer solitary activities and feel drained by social interactions, compared to extroverts who are energized by socializing.