If the inflation rate is zero, then
a. both the nominal interest rate and the real interest rate can fall below zero.
b. the nominal interest rate can fall below zero, but the real interest rate cannot fall below zero.
c. the real interest rate can fall below zero, but the nominal interest rate cannot fall below zero.
d. neither the nominal interest rate nor the real interest rate can fall below zero.
d
You might also like to view...
Describe the three different approaches to measuring the amount of economic activity that occurs during a period of time and explain why they all give identical measurements
What will be an ideal response?
The administrators of welfare programs have strong incentives to eliminate poverty
a. True b. False
Jane makes 1000 items a day. Each day she spends 8 hours producing those items. If hired elsewhere she could have earned $250 an hour. The item sells for $15 each. Production occurs seven days a week. If the explicit costs total $150,000 per month, what is her accounting profit?
a. $300,000 b. $60,000 c. $450,000 d. $240,000
A good economic model should capture as many details about real-world behavior as possible
a. True b. False Indicate whether the statement is true or false