The main goals of monetary policy include all of the following ...

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The main goals of monetary policy include all of the following EXCEPT
 
  A) attaining the maximum sustainable growth of potential GDP.
  B) keeping the unemployment rate close to the natural unemployment rate.
  C) keeping the long term nominal interest rate equal to the real interest rate plus the inflation rate.
  D) keeping the inflation rate low.
  E) keeping the long-term interest rate at a moderate level.

Question 2

Suppose that there is an increase in expected future disposable income and simultaneously an increase in the expected profitability of investment.
 
  As a result, the equilibrium real interest rate ________ and the equilibrium quantity of loanable funds ________.
  A) rises; decreases
  B) falls; might increase, decrease, or not change
  C) rises; might increase, decrease, or not change
  D) rises; increases
  E) falls; increases

[LVPMS]

Answer to Question 1

C

Answer to Question 2

C

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TYSM

[aliotak]

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