Author Question: The long-run Phillips curve shows the relationship between A) real GDP and the natural ... (Read 18 times)

Melani1276 · **on:** Jun 29, 2018

The long-run Phillips curve shows the relationship between

A) real GDP and the natural unemployment rate.
B) the nominal interest rate and real interest rate.
C) real GDP and potential GDP.
D) the inflation rate and the natural unemployment rate.
E) the inflation rate and the unemployment rate.

Question 2

The higher the federal funds rate, the ________ the opportunity cost of holding reserves, which ________ the incentive to economize on reserves.

A) lower; increases
B) lower; decreases
C) higher; decreases
D) lower; does not change
E) higher; increases