1. If the inflation rate exceeds the nominal rate of interest, a. the real interest rate is…

1. If the inflation rate exceeds the nominal rate of interest, a. the real interest rate is negative. b. lenders lose. c. savers lose. d. all of the answers are correct. 2. Suppose you place $10,000 in a retirement fund that earns a nominal interest rate of 8 percent. If you expect inflation to be 5 percent or lower, then you are expecting to earn a real interest rate of at least a. 1.6 percent. b. 3 percent. c. 4 percent. d. 5 percent.