Answered: The nominal interest rate O is a…

The nominal interest rate O is a percentage of the amount borrowed makes no allowance for inflation is the rate that most banks advertise all of the above O none of the above

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

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Quèstion 18
esc
The nominal interest rate
O is a percentage of the amount borrowed
O makes no allowance for inflation
O is the rate that most banks advertise
all of the above
Onone of the above
A Moving to another question will save this response.
Type here to search
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Expert Solution

Step 1

Irving fisher established the relationship between interest rate and inflation. There are two types of interest rate

real and nominal interest rate.

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