Which of the following is correct concerning real interest rates?
A) Real interest rates are constant.
B) Real interest rates must be positive.
C) Real interest rates must be less than nominal interest rates.
D) Real interest rates, if positive, indicate increased purchasing power.

Question

Quizplus · Accepted Answer

Real interest rates, if positive, indicate that the purchasing power of money is increasing, as they account for inflation.

Which of the Following Is Correct Concerning Real Interest Rates