If the purchasing power of your debt increases over time:
A) the real interest rate is positive.
B) the nominal rate of interest is positive.
C) the inflation rate is greater than the nominal interest rate.
D) the real interest rate is negative.
Correct Answer:
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Q98: Subtracting the inflation rate from the nominal
Q99: Suppose the annual nominal interest rate is
Q100: If the nominal interest rate is higher
Q101: If the nominal interest rate is higher
Q102: Deflation is a problem because it:
A) increases
Q104: Unexpected high inflation redistributes wealth from:
A) those
Q105: What effect does deflation have on consumption
Q106: If the real rate of return is
Q107: Deflation _consumption and investment, which _.
A) decreases;
Q108: Deflation:
A) reduces the level of aggregate demand
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