The real interest rate at which, in the absence of any shock, the demand for goods and services equals the natural level of output is called the rate of interest.
A)ex ante
B)ex post
C)natural
D)nominal

Question

Quizplus · Accepted Answer

The question describes the natural rate of interest, which is the real interest rate that balances demand and potential output in the long run. Therefore, the correct answer is C, natural rate. The other terms, ex ante and ex post, refer to expectations of future outcomes, and nominal refers to the interest rate before accounting for inflation.

The Real Interest Rate at Which, in the Absence of Any