From 1975 to 2008, which of the following countries experienced greater wage increases than the U.S.?

Which of the following events would most likely cause the nominal interest rate to fall?

a. A decrease in the supply of loanable funds b. An increase in the demand for loanable funds c. An increase in the supply of loanable funds and an increase in the demand for loanable funds d. An increase in the supply of loanable funds and a decrease in the demand for loanable funds e. A decrease in the supply of loanable funds and an increase in the demand for loanable funds

In an economy where aggregate spending is given by Y = 3,000 + .75Y - 10,000 r, the central bank is currently setting the interest rate at 0.06 (6 percent). If potential output equals 9,500, the central bank must ________ the interest rate to close the ________ gap.

A. raise; expansionary B. lower; recessionary C. lower; expansionary D. raise; recessionary