Author Question: You have a 500 saving bond. If the nominal interest rate is 10 percent, then the inflation rate must ... (Read 122 times)

fbq8i · **on:** Jun 30, 2018

You have a 500 saving bond. If the nominal interest rate is 10 percent, then the inflation rate must be

A) 10 percent if in real terms you earned 200.
B) 10 percent if in real terms you earned 100.
C) zero, otherwise you would sell the bond.
D) 4 percent if in real terms you earned 30.
E) 4 percent if in real terms you earned 70.

Question 2

If real GDP grew 5 percent last year and the population grew 2 percent, then real GDP per person grew by ________ percent.

A) 2 B) 5 C) 3 D) 7 E) 10