You borrow 10,000 from a bank for one year at a nominal interest ...

[cartlidgeashley]

You borrow 10,000 from a bank for one year at a nominal interest rate of 5. If inflation over the year is 2, what is the real interest rate you are paying?
 
  A) 2 B) 2.5 C) 3 D) 5

Question 2

If planned aggregate expenditure is above potential GDP and planned aggregate expenditure equals GDP, then
 
  A) the economy is in an expansion.
  B) actual inventory investment will be less than planned inventory investment.
  C) actual inventory investment will be greater than planned inventory investment.
  D) the economy is at full employment.

[heinisk01]

Answer to Question 1

C

Answer to Question 2

A

[cartlidgeashley]

Excellent

[kishoreddi]

Wow, this really help