If the Nominal Interest Rate Rises

question 60

Multiple Choice

If the nominal interest rate rises

• A)consumers and firms are less inclined to use credit cards.
• B)there is substantial inflation in the economy.
• C)inflation is declining.
• D)real interest rates are declining.
• E)the opportunity cost of holding cash rises.

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Definitions:

Anecdotes

Short, often amusing or interesting stories about real incidents or people.

Experiments

Controlled procedures carried out to investigate the effects of a variable by systematically manipulating it and observing the outcome.

Phrenologists

Practitioners of phrenology, a now-discredited theory that linked the shape of an individual's skull with their personality traits and mental abilities.

Theory Of Phrenology

A now-discredited theory that proposed the shape and size of the skull could determine a person's character and mental abilities.