a. a nominal interest rate of 5 percent and an inflation rate of 4 percent.

b. a nominal interest rate of 4 percent and an inflation rate of 3 percent.

c. a nominal interest rate of 14 percent and an inflation rate of 2 percent.

d. a nominal interest rate of 8 percent and an inflation rate of 1 percent.

FOORQUIZ ANSWER:

d. a nominal interest rate of 8 percent and an inflation rate of 1 percent.