In the medium run,lower money growth causes
A)lower real interest rates and lower nominal interest rates.
B)lower real interest rates and higher nominal interest rates.
C)higher real interest rates and higher nominal interest rates.
D)higher real interest rates and lower nominal interest rates.
E)none of the above

Question

Quizplus · Accepted Answer

In the medium run, lower money growth typically leads to lower nominal interest rates due to reduced inflation expectations, while real interest rates remain unchanged as they are determined by real factors in the economy.

In the Medium Run,lower Money Growth Causes