A decrease in the expected rate of inflation will _________ the expected return on bonds relative to that on _________ assets.
举一反三
- When the expected inflation rate decreases, the demand for bonds _________, the supply of bonds _________, and the interest rate _________.
- The relationship among real interest rate, nominal interest rate, and expected inflation rate is _________. A: real interest rate = nominal interest rate+ expected inflation rate B: real interest rate = nominal interest rate- expected inflation rate C: real interest rate = expected inflation rate - nominal interest rate D: nominal interest rate = real interest rate - expected inflation rate
- In which of the following situations would you prefer to be making a loan? A: The interest rate is 9 percent and the expected inflation rate is 7 percent. B: The interest rate is 4 percent and the expected inflation rate is 1 percent. C: The interest rate is 13 percent and the expected inflation rate is 15 percent. D: The interest rate is 25 percent and the expected inflation rate is 50 percent.
- The nominal interest rate minus the expected rate of inflation _________
- An increase in expected inflation causes the supply of bonds to _________ and the supply curve to shift to the _________.