Question: I'm not sure what the answer is Someone with dollar bills to lend will never agree to make a loan with a nominal interest rate

I'm not sure what the answer is

Someone with dollar bills to lend will never agree to make a loan with a nominal interest rate of less than zero because: O The lender is better off keeping the dollars than to agree to such a loan O It would not be fair to lend money under such conditions O It is mathematically impossible for the interest rate to be negative O The lender would not get any dollars back from the borrower Suppose that inflation is expected to be at -2% per year for the foreseeable future. If the nominal interest rate is 0% per year, then the real interest rate is _ per year
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
