If the nominal rate of interest on a bond was 5 percent, the ...

[storky111]

If the nominal rate of interest on a bond was 5 percent, the inflation rate was 3 percent and an individual was in a 25-percent tax bracket, the after-tax real return on the bond would be equal to
 
  a. 2 percent.
  b. 2.5 percent
  c. .5 percent..
  d. -.5 percent.
  e. none of the above.

Question 2

Farm prices fell sharply in 191921 . Then, until 1929, the farm terms of trade (the movement of farm prices relative to the movement of non-farm prices)
 
  (a) collapsed by more than half.
  (b) remained essentially unchanged.
  (c) actually rose.
  (d) collapsed, but only slightly.

[tuate]

Answer to Question 1

C

Answer to Question 2

(c)