In the Real Intertemporal Model,an Increase in Credit Market Risk

question 30

Multiple Choice

In the real intertemporal model,an increase in credit market risk implies

• A) output demand shifts left and output supply shifts right, increasing the real interest rate.
• B) output demand shifts right and output supply shifts left, the real interest rate is constant.
• C) output demand shifts left and output supply shifts left, decreasing the real interest rate.
• D) output demand shifts left and output supply is constant, increasing the real interest rate.
• E) output demand shifts left and output supply shifts right, decreasing the real interest rate.

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Definitions:

P-Value

The probability of observing data at least as extreme as those observed, given that the null hypothesis is true, used in hypothesis testing.

Sample Size

The number of observations or individuals included in a sample from a population for the purpose of statistical analysis.

Type II Error

A statistical error that occurs when a false null hypothesis is not rejected, also known as a false negative.

Not Guilty

A legal declaration that a defendant has not been proven to have committed the charges against them beyond a reasonable doubt.