According to the interest-rate-based monetary policy transmission mechanism
A) an increase in money supply will increase interest rates.
B) an increase in money supply will decrease interest rates.
C) a decrease in money supply will decrease interest rates.
D) a decrease in money supply will not change interest rates.
B
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The real risk-free interest rate is equal to:
a. The difference between the nominal interest rate and expected inflation. b. The tradeoff that society must make between consuming now and consuming later. c. The rate at which the International Monetary Fund borrows from the World Bank. d. The rate at which banks lend to their best customers (i.e., lowest credit risk). e. None of the above is correct.
The Solow residual is
A. a measure of the proportion of involuntarily unemployed workers. B. the most common measure of productivity shocks. C. a measure of the efficiency of the production process. D. the waste from the production process.