Which of the following is incorrect?
A) The nominal interest rate is the rate of interest expressed in terms of current dollars.
B) The real interest rate is the rate of interest expressed in terms of dollars of constant, or inflation-adjusted, value.
C) The nominal interest rate is the real interest rate less the rate of inflation.
D) During periods of inflation, the nominal interest rate will exceed the real interest rate.

Question

Quizplus · Accepted Answer

The statement "The nominal interest rate is the real interest rate less the rate of inflation" is incorrect. Nominal interest rate is the sum of the real interest rate and the rate of inflation.

Which of the Following Is Incorrect