Author Question: The nominal interest A) will never be negative. B) can be negative if inflation is unexpected. ... (Read 65 times)

ereecah · **on:** Jun 30, 2018

The nominal interest

A) will never be negative.
B) can be negative if inflation is unexpected.
C) can be negative if the inflation rate is greater than the nominal interest rate.
D) can be negative if deflation occurs.
E) can be negative when the real interest rate is negative.

Question 2

Which of the following would serve to reduce the costs caused by the variability of inflation?

A) seignorage
B) bracket creep
C) a higher capital gains tax
D) indexed wages
E) none of the above