In the Absence of Financial Frictions,________

question 78

Multiple Choice

In the absence of financial frictions,________.

• A)interest rates for different borrowers move closely together
• B)all loans in the economy are transacted at a common interest rate
• C)the level of output is not affected by changes in the real interest rate
• D)an increase in inflation leads to a decrease in the real interest rate

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Definitions:

Rules Of Exponents

Fundamental principles used to simplify expressions involving powers of the same base, including multiplication, division, and power of power rules.

Expression

A combination of symbols that represents a quantity or a relationship between quantities.

Y

In Cartesian coordinates, the vertical axis or the value that represents vertical position.

Expression

A combination of symbols and operators in mathematics that represents a specific value.