Author Question: Suppose you have 400 and the inflation rate is 5 percent. In order to earn a real return of 16 on ... (Read 106 times)

james9437 · **on:** Jun 30, 2018

Suppose you have 400 and the inflation rate is 5 percent. In order to earn a real return of 16 on your investment, the nominal interest rate needs to be near

A) 0 percent. B) 4 percent. C) 6 percent. D) 9 percent.

Question 2

Both increases in the price level and increases in real GDP will decrease the demand for money.

Indicate whether the statement is true or false