If you lend money at a 12% nominal interest rate, but you expect inflation to be 5% over the life of the loan, then you expect your purchasing power to grow at a rate of 1% The real interest rate is negative when the nominal interest rate is the inflation rate If the nominal interest rate is 3% and the expected rate of inflation is 1%, then the real interest rate is OA. - 1% B. 0% C. 3% D. 2% E. 1%