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alekssr [168]
2 years ago
6

The fed increases the quantity of money. in the short run, the quantity of money demanded ______ and the nominal interest rate _

_____.
Business
1 answer:
Nimfa-mama [501]2 years ago
8 0

The quantity of money demanded <u>increases</u> and the nominal interest rate <u>falls.</u>

In the short run, if the Fed(Federal Reserve) increases the quantity of money, the quantity of money demanded will increase and the nominal interest rate falls.  

The quantity of the money supplied and the nominal interest rates has an inverse relation. That is, when there is a huge supply of money in a short-term, it will cause an increase in the nominal interest rate.

The nominal interest rate refers to the interest rate before adjusting to inflation or price-hike. It balances the supply and demand of money.

So when there is an increase in the supply of money ,there will be the resulting increase in the demand of money too. The total money that the population wants to hold is referred as the money demanded.

Learn more about Fed( US Federal Reserve) at brainly.com/question/25843620

#SPJ4

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All of the following are true of the real interest rate except it Is equal to the nominal interest rate minus the anticipated ra
Lynna [10]

Answer:

Equals the foreign exchange rate minus the inflation rate.

Explanation:

Nominal rate of interest refers to the interest rate which does not account for rate of inflation.

It is expressed as

Nominal interest rate = Real interest rate + rate of inflation

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5 0
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BabaBlast [244]

Dividend to be paid to Preference shareholders in 2014= No of Preference shares*par value per share*Percentage of Shares

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=$5000

Dividends declared duing 2014=$3000, Thus Preference share holders need to be paid $2000 , in 2015, as preference shares are cumulative in nature.

Dividend to pe paid to Preference shareholders in 2015= $5000+$2000

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=$11000

Thus B will be the answer.

8 0
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