If the inflation rate is zero, then
A: both the nominal interest rate and the real interest rate can fall below zero.
B: the nominal interest rate can fall below zero, but the real interest rate cannot fall below zero.
C: the real interest rate can fall below zero, but the nominal interest rate cannot fall below zero.
D: neither the nominal interest rate nor the real interest rate can fall below zero.
A: both the nominal interest rate and the real interest rate can fall below zero.
B: the nominal interest rate can fall below zero, but the real interest rate cannot fall below zero.
C: the real interest rate can fall below zero, but the nominal interest rate cannot fall below zero.
D: neither the nominal interest rate nor the real interest rate can fall below zero.
举一反三
- The relationship among real interest rate, nominal interest rate, and expected inflation rate is _________. A: real interest rate = nominal interest rate+ expected inflation rate B: real interest rate = nominal interest rate- expected inflation rate C: real interest rate = expected inflation rate - nominal interest rate D: nominal interest rate = real interest rate - expected inflation rate
- When the interest rate on a bond is below the equilibrium interest rate, there is excess _________ in the bond market and the interest rate will _________ A: demand; rise B: demand; fall C: supply; fall D: supply; rise
- If the nominal interest rate is 5% and the inflation rate is 2%, then the real interest rate is 7%.
- If a country had deflation, A: the nominal interest rate would be greater than the real interest rate. B: the real interest rate would be greater than the nominal interest rate. C: the real interest rate would equal the nominal interest rate. D: None of the above is necessarily correct.
- The real interest rate is equal to the nominal rate minus inflation.