If the Nominal Interest Rate Is High and Rising, a Possible

question 138

Multiple Choice

If the nominal interest rate is high and rising, a possible cause is

• A) increased lending activity.
• B) a rising inflation rate.
• C) a falling real interest rates.
• D) increased government borrowing.

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Definitions:

Prices Frequently

A reference to how often prices change in a market, with some markets experiencing more frequent price adjustments than others.

Credible Threats

Statements or signs that a negative action could realistically be taken, used as a strategy in negotiations or competitive situations.

Collusive Agreements

Arrangements between firms to limit competition and manipulate markets in their favor, often through setting prices or controlling supply.

Game Theory

A mathematical framework used for analyzing situations in which parties make decisions that are interdependent, often used in economics, political science, and psychology to predict outcomes in strategic interactions.