If the rate of inflation is zero, prices are expected to remain stable, and the nominal rate of interest is 5 percent, then the
A) real rate of interest is equal to the nominal rate.
B) real rate of interest is less than the nominal rate.
C) nominal rate is greater than the real rate of interest.
D) investment demand schedule will shift upward.
A
You might also like to view...
A production possibilities curve shows the combinations of products which can be produced in an economy which is fully employing and efficiently using its productive resources
Indicate whether the statement is true or false
Economic growth is represented by a rightward shift of the long-run aggregate supply curve (LRAS)
a. True b. False Indicate whether the statement is true or false
Explain what it means to say that a theory is falsifiable or refutable? Give a specific example to help support your answer
Refer to the information provided in Table 25.3 below to answer the question(s) that follow.Table 25.3Refer to Table 25.3. People's Bank excess reserves are
A. $100,000. B. $200,000. C. $300,000. D. $400,000.