In January 2013, you can put your savings in a Bank of America account and be paid 2 percent per year. During 2013, suppose the inflation rate is 3.4 percent. In 2013 you earned a real interest rate of

When nominal interest rates increase, the opportunity cost of holding money will ________, and the quantity of money demanded by households and firms will ________

A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease

The potential for profit-increasing false advertising is greatest for which of the following goods?

A) disposable diapers B) a refrigerator C) laundry detergent D) spray window cleaner