Both the nominal rate of interest and the real return on ...

[maychende]

Both the nominal rate of interest and the real return on investment increase with the inflation rate.
 
  Indicate whether the statement is true or false

Question 2

If the Fed increases the interest rate in the U.S.:
 
  A) the demand curve for dollars will shift to the left.
  B) the demand curve for dollars will shift to the right.
  C) the supply curve of dollars will shift to the right.
  D) the real exchange rate of the U.S. will depreciate.

[kbennett34]

Answer to Question 1

FALSE

Answer to Question 2

B