Inflation is constant and nominal interest rate increases

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Reference no: EM13700850

If expected inflation is constant and the nominal interest rate increases, how does the real interest rate change?

a. It increases by more than the change in the nominal interest rate.

b. It increases by the change in the nominal interest rate.

c. It decreases by the change in the nominal interest rate.

d. It decreases by more than the change in the nominal interest rate.

Reference no: EM13700850

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