The Fisher equation implies ________. A) the nominal interest ...

[NguyenJ]

The Fisher equation implies ________.
 
  A) the nominal interest rate equals the real rate of inflation plus expected inflation
  B) the real interest rate equals expected inflation
  C) expected inflation equals current inflation
  D) the rate of inflation equals the real minus the nominal rates of interest
  E) none of the above

Question 2

A negative shock in aggregate demand will likely result in no permanent change in ________.
 
  A) output
  B) the equilibrium inflation rate if the central bank responds by lowering interest rates
  C) aggregate demand, if the central bank responds by lowering interest rates
  D) all of the above
  E) none of the above

[raili21]

Answer to Question 1

E

Answer to Question 2

D