If there is an increase in nominal GDP, we would expect:
A)the demand for money to increase.
B)the interest rate to rise.
C)bond prices to fall.
D)all of the above to occur.

Question

Quizplus · Accepted Answer

An increase in nominal GDP typically leads to higher demand for money, which can cause interest rates to rise and bond prices to fall, as higher interest rates make existing bonds with lower rates less attractive.

If There Is an Increase in Nominal GDP, We Would