If the nominal interest rate is higher than the real interest rate, then inflation must be:
A. positive.
B. zero.
C. negative.
D. higher than the nominal rate of interest.
Answer: A
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Consider the above figure. If the aggregate demand curve rose from AD1 to AD3, our nation would be experiencing
A) falling prices. B) an inflationary ga
In the textbook model of endogenous growth, long-run output growth would increase if there were either a ________ in the saving rate or a ________ in the depreciation rate
A) rise; rise B) rise; fall C) fall; rise D) fall; fall
If the marginal product of labor rises, the marginal cost of output
a. rises b. falls c. remains constant d. rises and then falls e. dampens
Which of the following might result in an underestimation of GDP?
a. Significant underground activity such as trade in illegal drugs b. Sales of used cars c. Many intermediate goods d. Imported goods e. Exported goods