In the Model the Nominal Interest Rate Equals the Nominal

question 10

Multiple Choice

In the model the nominal interest rate equals the nominal net return on capital, i = (R/P) - , because:

• A)other than rates of return bonds and capital look the same to households as assets.
• B)capital is riskier than bonds.
• C)bonds are riskier than capital.
• D)bonds are zero in the aggregate.

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Instinctive Behavior

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Unlearned

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