When Prices Increase, the Real Interest Rate

question 47

Multiple Choice

When prices increase, the real interest rate

• A) will increase and total planned spending on goods and services will increase.
• B) will increase and total planned spending on goods and services will decrease.
• C) will decrease and total planned spending on goods and services will decrease.
• D) will not be affected.

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Definitions:

Deindustrialization

A social and economic change resulting from the reduction of industrial activity, especially manufacturing.

Social Change

Alterations in the social structure and cultural values of a society over time.

Industrial Activity

Economic activities related to the production of goods and services in sectors such as manufacturing, mining, and construction.

Economic Change

Alterations in the structure, performance, or operations of an economy, often marked by growth or decline.