The real rate of interest equals the
a. money rate of interest minus the expected inflation rate.
b. money rate of interest plus the expected inflation rate.
c. inflationary premium.
d. nominal rate of interest.
A
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The k-percent rule, an example of a money targeting rule, relies on a relatively stable
A) supply of money. B) real interest rate. C) demand for money. D) federal funds rate. E) nominal GDP.
Whenever the absolute value of the price elasticity of demand is greater than 1, but less than infinite
A) demand is inelastic. B) demand is unit elastic. C) demand is elastic. D) demand is perfectly elastic.
When a firm's marginal productivity declines as output increases, then the firm is experiencing
a. Diminishing returns to scale b. Constant returns to scale c. Increasing returns to scale d. Increasing marginal product
If nominal GDP decreases this will:
a. Decrease the transactions demand and total demand for money b. Increase the transactions demand for money but decrease the total demand for money c. Increase the transactions demand and total demand for money d. Decrease the transactions demand for money but increase the total demand for money