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Which of the following best describes how banks determine what interest rate to charge? Choose 1 answer: Choose 1 answer: (Choice A) Nominal interest +

Which of the following best describes how banks determine what interest rate to charge? Choose 1 answer: Choose 1 answer: (Choice A) Nominal interest + real GDP growth rate A Nominal interest + real GDP growth rate (Choice B) Real interest - real GDP growth rate B Real interest - real GDP growth rate (Choice C) Expected nominal interest + expected inflation C Expected nominal interest + expected inflation (Choice D) Nominal interest - inflation D Nominal interest - inflation (Choice E) Expected real interest + expected inflation E Expected real interest + expected inflation

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