Ask Question
BusinessBusiness
12 August, 15:56

Why can the fed control the real interest rate in the short run but not in the long run?

+5
Answers (1)
  1. 12 August, 16:24
    0
    It adjusts for inflation, and prices are sticky in the short run.

    when a change in the fed's monetary policy causes the nominal interest rate to change, the real interest rate also changes in the same direction. in the long run, actual and expected inflation change in response to changes in monetary policy, leaving the real interest rate unaffected
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Why can the fed control the real interest rate in the short run but not in the long run? ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
The 12/31/2013 balance sheet of Despot Inc. included the following: Common stock, 25 million shares at $20 par $500 million Paid-in capital-excess of par 3,000 million Retained earnings 980 million In January 2013, Despot recorded a transaction with
Answers (1)
Monica and her team have implemented IS successfully in an organization. What factor leads to successful IS implementation? Good between different departments in an organization leads to successful IS implementation.
Answers (1)
A skilled nursing facility chain is considering building a new facility on a piece of property that it currently owns. The property was purchased five years ago for $250,000 and could be sold now at a current market value of $100,000.
Answers (1)
Berkshire Inc. uses a periodic inventory system. At the end of 2017, it missed counting some inventory items, resulting in an inventory understatement by $600,000.
Answers (1)
Danner corporation and london corporation, two companies of roughly the same size, are both involved in the manufacture of shoe-tracing devices
Answers (1)
New Questions in Business
Henry Crouch's law office has traditionally ordered ink refills 7070 units at a time. The firm estimates that carrying cost is 4545 % of the $1212 unit cost and that annual demand is about 245245 units per year.
Answers (1)
What would power of attorney be needed?
Answers (2)
The yield on a one-year Treasury security is 5.8400%, and the two-year Treasury security has a 8.7600% yield.
Answers (1)
A serious risk factor associated with the operation of a nuclear power plant is the production of
Answers (1)
Raegan Sisvemore said consumer protection laws for vehicles are applied when a car has which type of problem? O Electronic problem O Engine problem O Aesthetic problem O Reoccurring problem
Answers (1)
Home » Business » Why can the fed control the real interest rate in the short run but not in the long run?
Sign Up Forgot Password?