The Domestic Real Interest Rate in a Small Open Economy

question 33

Multiple Choice

The domestic real interest rate in a small open economy is

• A) determined by the intersection of the supply curve and demand curve for loanable funds in the country.
• B) equal to the world real interest rate.
• C) the same as its nominal interest rate.
• D) determined by the total value of net exports in the country.

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Definitions:

Myomalacia

The softening of muscle tissue, often due to disease, injury, or lack of blood supply.

Myasthenia

A condition characterized by extreme muscle weakness and fatigue.

Bradykinesia

Slowness of movement, often seen in Parkinson's disease.

Antagonist

A substance that blocks or inhibits the effects of a neurotransmitter or hormone, often used in the context of drug action.