The Nominal Interest Rate, I_t, Is the Rate of Return

question 76

Multiple Choice

The nominal interest rate, i_t, is the rate of return between periods:

• A) t - 1 and t
• B) t and t + 1
• C) t - 1 and t + 1
• D) t and t + 2

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Definitions:

Garcia and Koelling

Refers to researchers who conducted experiments on taste aversion learning, demonstrating that animals could learn to avoid foods that made them sick.

Law of Effect

A psychological principle stating that responses followed by a satisfying effect become more likely to occur, while responses followed by a discomforting effect become less likely.

Thorndike

An American psychologist known for his work on learning theory and the law of effect, which suggested that behaviors followed by satisfying outcomes are likely to be repeated.

Stimulus

Any event or situation that evokes a response from an organism.