The real interest rate is 4 percent a year. When the inflation rate is zero, the nominal interest rate is approximately ________ percent a year; and when the inflation rate is 2 percent a year, the nominal interest rate is approximately ________
percent a year. A) 0; 2
B) 4; 6
C) 6; 8
D) 6; 4
Question 2
The curvature of the production function shows that as employment increases, the productivity of labor
A) remains positive and increases.
B) remains positive but decreases.
C) decreases and becomes negative.
D) remains constant.
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