Question: measures the real ( that is , inflation - adjusted ) cost of borrowing or lending. Sources: Ben Bernanke, Remarks by Governor Ben S .

measures the real (that is, inflation-adjusted) cost of borrowing or lending.
Sources: Ben Bernanke, "Remarks by Governor Ben S. Bernanke," Th Federal Reserve Board, November 21,2002; Marc Prosser, "W Deflation Export Japan's Economic Woes to the World?"
SingularityHub.com, April 14,2017.
q,
Someone with dollar bills to lend will never agree to make a loan with a nominal interest rate of less than zero because:
The lender would not get any dollars back from the borrower
It is mathematically impossible for the interest rate to be negative
It would not be fair to lend money under such conditions
The lender is better off keeping the dollars than to agree to such a loan
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 q, per year.
measures the real ( that is , inflation -

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