The substitution effect of a change in the real interest rate is an example of
A) a negative substitution effect.
B) a positive substitution effect.
C) an intertemporal substitution effect.
D) a temporary substitution effect.
E) a permanent substitution effect.
Correct Answer:
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Q50: An increase in the real interest
A) increases
Q51: The government's present value budget constraint states
Q52: If government spending is held constant and
Q53: A key channel for interest rate effects
Q54: The government's current period budget constraint is
A)
Q56: In the case where current and future
Q57: An increase in the real interest rate
Q58: The Ricardian equivalence theorem implies that
A) government
Q59: For a lender, an increase in the
Q60: An important reason why Ricardian equivalence may
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