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Scilla [17]
3 years ago
15

An unusual development in the wake of the 2007-2009 financial crisis was that nominal interest rates on some financial instrumen

ts turned negative. In which of the following examples would the nominal interest rate be negative? In each case explain your choice clearly.
a. The real interest rate is 2 percent and the expected inflation rate is 1 percent.

b. The real interest rate is zero and the expected inflation rate is 2 percent.

c. The real interest rate is 1 percent and the expected inflation rate is minus 2 percent.

d. The real interest rate is minus 2 percent and the expected inflation rate is 3 percent
Business
1 answer:
bogdanovich [222]3 years ago
4 0

Answer:

c. The real interest rate is 1 percent and the expected inflation rate is minus 2 percent

Explanation:

Nominal interest rate = real interest rate + expected inflation rate.

For the third option, the nominal interest rate: 1% + (-2%) = -1%

For the first option, the nominal interest rate: 2% + 1% = 3%

For the second option, the nominal interest rate: 0 + 2% = 2%

For the fourth option, the nominal interest rate: -2% + 3% = 1%

I hope my answer helps you

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How often should a financial checkup be completed
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2 years ago
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andrezito [222]

Answer:

The average fixed cost is $2.4.

Explanation:

Vipsana's Gyros House sells gyros.

The cost of ingredients​ to make a gyro is​ $2.00.  

Vipsana pays her employees​ $60 per day.  

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