According to the classical dichotomy, what is influenced by monetary factors?
A) real GDP
B) investment
C) nominal interest rates
D) the real wage rate

Question

Quizplus · Accepted Answer

According to the classical dichotomy, monetary factors influence nominal variables such as nominal interest rates, while real variables such as real GDP, investment, and the real wage rate are determined by real factors such as technology, resources, and institutions. Therefore, the best choice is C, nominal interest rates.

According to the Classical Dichotomy, What Is Influenced by Monetary