Author Question: If the nominal interest rate is held constant, a higher inflation rate tends to A) reduce the ... (Read 56 times)

tsand2 · **on:** Jun 29, 2018

If the nominal interest rate is held constant, a higher inflation rate tends to

A) reduce the real interest rate.
B) increase the real interest rate.
C) leave the real interest rate unchanged.
D) have no effect on the savings decisions of households.

Question 2

Refer to the figure above. How many units of Good X will be supplied if the government sets a price ceiling of Pc on the good?

A) 0 units
B) 10 units
C) 25 units
D) 35 units