Evidence Suggests That a Liquidity Trap Is Possible When

question 85

Multiple Choice

Evidence suggests that a liquidity trap is possible when

• A)real interest rates are at zero.
• B)real interest rates are at or just above zero.
• C)nominal interest rates are at zero.
• D)nominal interest rates are at or just above zero.

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Definitions:

Malpractice

Occurs when a professional accountant, health care professional, or attorney—fails to meet his or her duty of care.

Cardozo Standard

A legal principle named after Justice Benjamin Cardozo, emphasizing the importance of foreseeability and reasonable expectations in determining duty of care.

Privity

In contract law, the relationship that exists between two parties to a contract giving each a recognized interest in the subject matter of the contract so that they are bound to that contract.

Sarbanes-Oxley

A U.S. federal law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures.