Question: With nominal interest rates, the _ _ _ _ _ helps protect lenders from having their purchasing power reward wiped out by higher prices and
With nominal interest rates, the helps protect lenders from having their purchasing power reward wiped out by higher prices and the compensates investors for the additional risk that the loan will not be repaid as agreed to by borrowers.
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Part
A
maturity premium; inflation premium
B
inflation premium; default premium
C
default premium; real rate
D
real rate; maturity premium
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