On the following graph, use the orange points (square symbol) to plot the nominal Interest rates for the years 1971 to 1975. Next, use the green points (triangle symbol) to plot the real interest rates for those years. (? A-Z 8.0 7.0 6.0 Nominal Interest Rate 5.0 4.0 Real Interest Rate W 3.0 2.0 1.0 -1.0 -2.0 -3.0 1970 1971 1972 1973 1974 1975 1976 YEAR According to the table, in which year did buyers of six-month Treasury bills receive the highest real return on their investment? O 1971 O 1972 MacBook Air INTEREST RATE (Percent)

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Chapter12: Money Growth And Intlation
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4. Inflation and interest rates
The following table shows the average nominal interest rates on six-month Treasury bills between 1971 and 1975, which determined the nominal
tudy Tools
interest rate that the U.S. government paid when it issued debt in those years. The table also shows the inflation rate for the years 1971 to 1975. (All
rates are rounded to the nearest tenth of a percent.)
sר
ns
ess Tips
A-Z
Nominal Interest Rate
Inflation Rate
Year
(Percent)
(Percent)
ess Tips
1971
4.5
4.2
R YOU
1972
4.5
3.3
1973
7.2
6.3
1974
8.0
11.0
1975
6.1
9.1
SUCCESS
Source: "FRED Economic Data," Federal Reserve Bank of St. Louis, last modified September 23, 2019, accessed September 24, 2019, https://fred.stlouisfed.org.
On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green
points (triangle symbol) to plot the real interest rates for those years.
dback
(?
B.O
7.0
Nominal Interest Rate
6.0
5.0
MacBook Air
4)
F11
F10
ODO
F7
F5
F4
24
%
&
delete
%23
7
2
4
Transcribed Image Text:4. Inflation and interest rates The following table shows the average nominal interest rates on six-month Treasury bills between 1971 and 1975, which determined the nominal tudy Tools interest rate that the U.S. government paid when it issued debt in those years. The table also shows the inflation rate for the years 1971 to 1975. (All rates are rounded to the nearest tenth of a percent.) sר ns ess Tips A-Z Nominal Interest Rate Inflation Rate Year (Percent) (Percent) ess Tips 1971 4.5 4.2 R YOU 1972 4.5 3.3 1973 7.2 6.3 1974 8.0 11.0 1975 6.1 9.1 SUCCESS Source: "FRED Economic Data," Federal Reserve Bank of St. Louis, last modified September 23, 2019, accessed September 24, 2019, https://fred.stlouisfed.org. On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green points (triangle symbol) to plot the real interest rates for those years. dback (? B.O 7.0 Nominal Interest Rate 6.0 5.0 MacBook Air 4) F11 F10 ODO F7 F5 F4 24 % & delete %23 7 2 4
On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green
points (triangle symbol) to plot the real interest rates for those years.
(?
A-Z
8.0
7.0
6.0
Nominal Interest Rate
5.0
4.0
Real Interest Rate
w 3.0
2.0
1.0
-1.0
-2.0
-3.0
1970
1971
1972
1973
1974
1975
1976
YEAR
According to the table, in which year did buyers of six-month Treasury bills receive the highest real return on their investment?
O 1971
O 1972
MacBook Air
INTEREST RATE (Percent)
Transcribed Image Text:On the following graph, use the orange points (square symbol) to plot the nominal interest rates for the years 1971 to 1975. Next, use the green points (triangle symbol) to plot the real interest rates for those years. (? A-Z 8.0 7.0 6.0 Nominal Interest Rate 5.0 4.0 Real Interest Rate w 3.0 2.0 1.0 -1.0 -2.0 -3.0 1970 1971 1972 1973 1974 1975 1976 YEAR According to the table, in which year did buyers of six-month Treasury bills receive the highest real return on their investment? O 1971 O 1972 MacBook Air INTEREST RATE (Percent)
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