As distinct from reductions in the price level, reductions in the rate of inflation are referred to as:

Compared to a single-price monopoly, the output of a perfectly competitive market with the same costs

A) is more than the monopoly's output. B) is the same as the monopoly's output. C) is less than the monopoly's output. D) could be more than, less than, or equal to the monopoly's output.

If the expected inflation rate was 2.5%, the expected real interest rate was 4.0%, and the real interest rate turned out to be 5.1%, then the actual inflation rate equals

A) 1.4%. B) 1.5%. C) 2.6%. D) 6.5%.