to a friend for one year at a nominal interest rate of 10 Inflation during that

# To a friend for one year at a nominal interest rate

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to a friend for one year at a nominal interest rate of 10%. Inflation during that year is 5%. As a result, you will receive ________ at the end of the year, but that money has a purchasing power of ________. Answer Selected Answer: \$5,500; \$5,250 Correct Answer: \$5,500; \$5,250 Question 7 0.5 out of 0.5 points If inflation is positive and is perfectly anticipated, Answer Selected Answer: those that hold paper money lose. Correct Answer: those that hold paper money lose. Question 8 0.5 out of 0.5 points
The demand for loanable funds has a ________ slope because the lower the interest rate, the ________ number of investment projects are profitable, and the ________ the quantity of loanable funds demanded. Answer Selected Answer: negative; greater; greater Correct Answer: negative; greater; greater Question 9 0.5 out of 0.5 points Figure 10-1 Refer to Figure 10-1. The loanable funds market is given in the figure above. If the current real interest rate is 5 percent, which of the following is true? Answer Selected Answer: There is a surplus of loanable funds in the
market. Correct Answer: There is a surplus of loanable funds in the market. Question 10 0.5 out of 0.5 points Figure 10-1 Refer to Figure 10-1. The loanable funds market is in equilibrium, as shown in the figure above. As a result of an increase in the government budget deficit, the ________ for loanable funds will ________, thereby ________ the equilibrium real interest rate and ________ the equilibrium quantity of loanable funds. Answer Selected Answer: supply; fall; increasing; decreasing Correct Answer: supply; fall; increasing; decreasing

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