What effect would each of the following events likely have on the level of nominalinterest rates?1. Households dramatically increase their savings rate.2. Corporations increase their demand for funds following an increase in investmentopportunities.3. The government runs a larger-than-expected budget deficit.4. There is an increase in expected inflation.
What effect would each of the following events likely have on the level of nominalinterest rates?1. Households dramatically increase their savings rate.2. Corporations increase their demand for funds following an increase in investmentopportunities.3. The government runs a larger-than-expected budget deficit.4. There is an increase in expected inflation.
Question
What effect would each of the following events likely have on the level of nominal
interest rates?
1. Households dramatically increase their savings rate.
2. Corporations increase their demand for funds following an increase in investment
opportunities.
3. The government runs a larger-than-expected budget deficit.
4. There is an increase in expected inflation.
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