Suppose that over the past year, the real interest rate was 3 percent and the inflation rate was 1 percent. It follows that
a. the dollar value of savings increased at 2 percent, and the purchasing power of savings increased at 3 percent.
b. the dollar value of savings increased at 2 percent, and the purchasing power of savings increased at 4 percent.
c. the dollar value of savings increased at 4 percent, and the purchasing power of savings increased at 2 percent.
d. the dollar value of savings increased at 4 percent, and the purchasing power of savings increased at 3 percent.
d
You might also like to view...
If the United States exports planes to Brazil and imports ethanol from Brazil, the price received by U.S. producers of planes ________, and the price received by Brazilian producers of ethanol ________
A) does not change; does not change B) rises; rises C) rises; falls D) falls; rises E) falls; falls
Assume that the currency—deposit ratio is 0.2 and the reserve—deposit ratio is 0.1. The Federal Reserve carries out open-market operations, purchasing $1 million worth of bonds from banks. This action will increase the money supply by
A) $1 million. B) $2 million. C) $3 million. D) $4 million.
As output rises, marginal product eventually diminishes and
a. marginal cost increases. b. total cost falls. c. fixed cost increases. d. average product becomes negative.
Equilibrium price must increase when demand
a. increases and supply does not change, when demand does not change and supply decreases, and when demand decreases and supply increases simultaneously. b. increases and supply does not change, when demand does not change and supply decreases, and when demand increases and supply decreases simultaneously. c. decreases and supply does not change, when demand does not change and supply increases, and when demand decreases and supply increases simultaneously. d. decreases and supply does not change, when demand does not change and supply increases, and when demand increases and supply decreases simultaneously.