Which of the following statements is correct?
A. The long-run real interest rate varies directly with changes in non-interest sensitive components of aggregate demand and directly with potential output.
B. The long-run real interest rate varies inversely with changes in non-interest sensitive components of aggregate demand and inversely with potential output.
C. The long-run real interest rate varies directly with changes in non-interest sensitive components of aggregate demand and inversely with potential output.
D. The long-run real interest rate varies directly with changes in non-interest sensitive components of aggregate demand and does not vary with potential output.
Answer: C
You might also like to view...
GDP can be calculated by summing ________.
A. consumption, investment, government purchases, and net exports B. consumption, investment, government purchases, exports, and imports C. consumption, investment, wages, and rents D. consumption, investment, government purchases, and imports
A fundamental aspect of economics is to
A) ensure that every firm makes a profit. B) analyze how choices are made. C) satisfy all our wants. D) make sure that our resources will always be unlimited.
Which of the following is an example of trade policy at the national level?
a. Congress passing legislation to prevent dumping. b. The European Union adopting a common currency c. The World Trade Organization holding a round of negotiations in France. d. The General Agreement on Tariffs and Trade being made.
The most obvious benefit of specialization and trade is that they allow us to
a. work more hours per week than we otherwise would be able to work. b. consume more goods than we otherwise would be able to consume. c. spend more money on goods that are beneficial to society, and less money on goods that are harmful to society. d. consume more goods by forcing people in other countries to consume fewer goods.