If the nominal interest rate in an economy is 6%, and the rate of inflation in the economy is 4%, the real interest rate in the economy is:

The consumption function becomes flatter if:

a. the average propensity to spend increases. b. the marginal propensity to spend increases. c. the marginal propensity to save increases. d. the autonomous consumption increases. e. the autonomous consumption decreases.

Which of the following is a recommended strategy to increase productivity of the private sector?

a. A reduction in government subsidies to producers b. An increase in business taxes c. An increase in government investment in risky projects d. An increase in the money supply e. An increase in subsidy on goods and services