Increase in nominal interest rates

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Which of the following factors would be most likely to lead to an increase in nominal interest rates?

a. The economy falls into a recession, which leads to a decline in investmentopportunities.

b. The Federal Reserve takes steps to stimulate the economy, and their actions have no immediate effect on the level of inflation.

c. Households increase their consumption and reduce their savings.

d. There is a decline in the maturity risk premium.

e. There is a decrease in expected inflation.

Reference no: EM133005045

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