The Substitution Effect Indicates That Higher Real Interest Rates ________

question 24

Multiple Choice

The substitution effect indicates that higher real interest rates ________ current consumption for households who are lenders and ________ current consumption for households who are borrowers.

• A) increase; increase
• B) increase; decrease
• C) decrease; increase
• D) decrease; decrease

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Definitions:

Comprehensive Knowledge

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Human Resource Information System

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Customer-Oriented Approach

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