The graph illustrates the market for bottled water. When the price exceeds the equilibrium price, the quantity demanded is ________ the quantity supplied and the price of the good will ________.
A) less then; fall
B) greater than; fall
C) equal to; fall
D) less than; rise
E) greater than; rise
Question 2
You borrow at a nominal interest rate of 10 percent. If the inflation rate is 4 percent, then the real interest rate is
A) 6 percent.
B) 14 percent.
C) the 10 in interest you have to pay.
D) 16 percent.
E) 2.5 percent.
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