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With no inflation, a bank would be willing to lend a business firm $5 million at an annual interest rate of 4 percent. But if
With no inflation, a bank would be willing to lend a business firm $5 million at an annual interest rate of 4 percent. But if the rate of inflation was anticipated to be 3 percent, the bank would most likely charge the firm an annual interest rate of
Multiple Choice
- 7 percent.
- 1 percent.
- 3 percent.
- 4 percent.
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