The MP curve may be used to represent ________
A) movements of the real interest rate as a direct policy action of the Federal Reserve
B) movements of the real interest rate that are independent of direct Federal Reserve action
C) how the real interest rate is related to the inflation rate
D) all of the above
E) none of the above
D
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Assume a country produces two types of goods: manufactured goods and agricultural goods. When this country experiences economic growth, we know that
A) the production possibilities curve will shift inward. B) there will be movement along the curve toward more agricultural goods. C) there will be a movement along the curve toward more manufactured goods. D) the production possibilities curve will shift outward.
If there is a decrease in world investment ________
A) domestic investment would fall B) net capital outflow would increase C) the domestic interest rate would go up D) all of the above E) none of the above