Consider two economies, A and B, with the same constant growth rate of nominal money supply and a constant real interest rate r=0.03. Also assume the economies' output grows at the same rate of 0.04. Which of the following comparisons is NOT valid? OA. If nyAY,B. then A= B z B. The growth rates of the real demand for money in the two economies may not be the same. OC. The nominal interest rates of the two economies may may not be the same OD. If nyAny B. then #A> #B 4

Consider two economies, A and B, with the same constant growth rate of nominal money supply and a constant real interest rate r=0.03. Also assume the economies' output grows at the same rate of 0.04. Which of the following comparisons is NOT valid? OA. If nyAY,B. then A= B z B. The growth rates of the real demand for money in the two economies may not be the same. OC. The nominal interest rates of the two economies may may not be the same OD. If nyAny B. then #A> #B 4

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter27: Issues In Macroeconomic Theory And Policy

Section: Chapter Questions

Problem 6P

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