Data on real and nominal interest rates of one-year U.S. T-Bills show that, over the past twenty years,
A) the nominal rate has always been less than the real rate.
B) whenever the nominal rate rises, the real rate falls, and vice versa.
C) the nominal rate has varied, but the real rate has not.
D) the real rate has varied, but the nominal rate has not.
E) the real rate has always been less than the nominal rate.
E
You might also like to view...
According to the real business cycle theory, which of the following is a TRUE statement about the effects of an oil shock in the 1970s?
A) Relative prices changed but there was no impact on the price level in general. B) The natural rate of unemployment remained unchanged, but employment levels did decline. C) The shock shifted the short-run aggregate supply curve but not the long-run aggregate supply curve. D) The shock affected real variables only and did not affect nominal variables.
Consider a broom factory that permanently closes because of foreign competition. If the broom factory's workers cannot find new jobs because their skills are no longer marketable, then they are classified as:
a. seasonally unemployed. b. frictionally unemployed. c. structurally unemployed. d. cyclically unemployed.