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An investor requires a 3 percent increase in purchasing power in order to induce her to lend. She expects inflation to be 2 percent next

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An investor requires a 3 percent increase in purchasing power in order to induce her to lend. She expects inflation to be 2 percent next year. The real rate is about -1 percent 5 percent. 7 percent. O 1 percent O 2 percent. 3 percent

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