If People Expect Nominal Interest Rates to Be Higher in the Future,the

question 79

Multiple Choice

If people expect nominal interest rates to be higher in the future,the expected return to bonds ________,and the demand for money ________.

• A)rises;increases
• B)rises;decreases
• C)falls;increases
• D)falls;decreases

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Definitions:

Coercive

Relating to or using force or threats to persuade someone to do something or comply with one's demands.

Expert

A person who possesses a high level of knowledge, skills, or expertise in a particular field or area.

Referent

The entity to which a word or phrase refers or relates.

Legitimate Power Base

A source of influence based on the formal authority one holds within an organization's structure or society's laws.