The demand for money curve shifts rightward if

If the real interest rate is greater than the nominal interest rate in an economy:

A) inflation must be negative in the economy. B) inflation must be positive in the economy. C) inflation must be zero in the economy. D) the nominal interest rate must be equal to zero.

Cigarettes are highly addictive and therefore have a very low elasticity of demand. A $2.00 increase in the national sales tax on cigarettes would likely cause the price paid by buyers of cigarettes to

A) increase by more than $1.00 but less than $2.00. B) increase by $2.00. C) increase by more than $2.00. D) increase by less than $1.00. E) remain unchanged.