This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If the inflation rate is positive, then the real interest rate is greater than the nominal interest ... (Read 182 times)

ENagel

  • Hero Member
  • *****
  • Posts: 540
on: Jun 29, 2018
If the inflation rate is positive, then the real interest rate is greater than the nominal interest rate. Is the previous statement correct or incorrect? Explain your answer.
 
  What will be an ideal response?

Question 2

Which of the following formulas is correct?
 
  A) Net investment = gross investment + capital
  B) Net investment = gross investment - saving
  C) Net investment = gross investment - wealth
  D) Net investment = gross investment - depreciation
  E) Net investment = gross investment + depreciation


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

bigsis44

  • Sr. Member
  • ****
  • Posts: 317
Reply #1 on: Jun 29, 2018
Answer to Question 1

The statement is incorrect. The nominal interest rate equals the real interest rate plus the inflation rate. Therefore, if the inflation rate is positive, the nominal interest rate is greater than the real interest rate.

Answer to Question 2

D


ENagel

  • Member
  • Posts: 540
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

raenoj

  • Member
  • Posts: 340
Reply 3 on: Yesterday
Gracias!

« previous next »
 

Did you know?

Alzheimer's disease affects only about 10% of people older than 65 years of age. Most forms of decreased mental function and dementia are caused by disuse (letting the mind get lazy).

Did you know?

More than 50% of American adults have oral herpes, which is commonly known as "cold sores" or "fever blisters." The herpes virus can be active on the skin surface without showing any signs or causing any symptoms.

Did you know?

Women are two-thirds more likely than men to develop irritable bowel syndrome. This may be attributable to hormonal changes related to their menstrual cycles.

Did you know?

The modern decimal position system was the invention of the Hindus (around 800 AD), involving the placing of numerals to indicate their value (units, tens, hundreds, and so on).

Did you know?

Warfarin was developed as a consequence of the study of a strange bleeding disorder that suddenly occurred in cattle on the northern prairies of the United States in the early 1900s.

Rate enhancement by entropy reduction Rate enhancement by entropy reduction
Rate of Growth of Brain Areas Rate of Growth of Brain Areas
Constant velocity versus positive velocity Constant velocity versus positive velocity
How to convert units of any rate to another (Part 3) How to convert units of any rate to another (Part 3)
The cell wall of a Gram-positive bacterium, S. aureus The cell wall of a Gram-positive bacterium, S. aureus
Please help me with a Real Estate Course Problem Please help me with a Real Estate Course Problem
Video: Digestion Animation

For a complete list of videos, visit our video library