In a Situation of Inflationary Pressure, an Increase in the Overnight

question 12

Multiple Choice

In a situation of inflationary pressure, an increase in the overnight loans rate results in

• A)an increase in real GDP and the price level.
• B)an increase in real GDP, but a fall in the price level.
• C)an increase in real GDP, but no change in the price level.
• D)a rise in the price level, but no change in real GDP.
• E)a fall in the price level and a decrease in real GDP.

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Definitions:

Profit-sharing Plan

A profit-sharing plan is an incentive program in which employees receive a share of the company's profits, typically distributed annually.

Total Commitment

A state or condition of being fully dedicated or completely loyal to a cause, activity, or the duties and responsibilities of a role or position.

Labour Cost Savings

Reductions achieved in the expenses related to employing labor, often through efficiencies, negotiations, or changes in work practices, without compromising productivity.

Short-term Incentives

Compensation methods designed to provide immediate rewards for performance, typically in the form of bonuses, to motivate employees over a short period.