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Lillian Loaned A

Question 172

Multiple Choice

Lillian loaned A.J. $10,000 and increased her purchasing power by $200 when A.J. repaid the loan a year later. Deflation of 2% also occurred that year. What nominal interest rate did Lillian charge A.J.?


A) 0%
B) 2%
C) 4%
D) 2.5%

Correct Answer:

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