What is the real-balance effect of an increase in the price level?
What will be an ideal response?
Question 2
Assuming all else equal, if the real interest rate increases, it will lead to:
A) a decrease in the quantity of credit demanded by a firm.
B) a rightward shift of the credit demand curve of a firm.
C) a leftward shift of the credit demand curve of a firm.
D) an increase in the quantity of credit demanded by a firm.