Which of the following best defines the real interest rate (r)?
A) the amount of goods we must give up next year in order to consume more goods today
B) the amount of dollars we must give up next year in order to consume more goods today
C) the amount of dollars we must give up next year in order to have more dollars today
D) the amount of dollars we must give up today in order to have more dollars next year
E) the amount of dollars we must give up today in order to consume more goods today
A
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Seigniorage is defined as the difference between the exchange value of a money and its cost of production
Indicate whether the statement is true or false
Assume that prices have risen in a given economy by an average of 5 percent over the last nine years. If consumers base their expectations about future price movements on that knowledge alone their forecasts rely on ________
A) reverse expectations B) adaptive expectations C) rational expectations D) monetary expectations