The nominal interest rate adjusted for expected inflation is the
A)expected real interest rate.
B)realized real interest rate.
C)after-tax real interest rate.
D)yield curve.

Question

Quizplus · Accepted Answer

The nominal interest rate adjusted for expected inflation is the expected real interest rate. This is because the expected inflation rate is subtracted from the nominal interest rate to obtain the real interest rate, which reflects the actual purchasing power of the interest earned.

The Nominal Interest Rate Adjusted for Expected Inflation Is the