Which of the following statements is logically valid?
A) If the real interest rate is less than the nominal interest rate, inflation must be zero.
B) If the real interest rate is less than the nominal interest rate, inflation must be negative.
C) If the rate of inflation is less than the nominal interest rate, the real interest rate is positive.
D) If the nominal interest rate is high, the real interest rate must be high.
E) If the rate of inflation is high, the nominal rate of interest must be low.
Correct Answer:
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