Answer on Economics of Enterprise Question for Kambungo
2. What will happen in ( 1.) if money supply increases by 15%?
nominal interest rate:
In finance and economics, nominal interest rate or nominal rate of interest refers to two distinct things: the rate of interest before adjustment for inflation or, for interest rates "as stated" without adjustment for the full effect of compounding (also referred to as the nominal annual rate). An interest rate is called nominal if the frequency of compounding (e.g. a month) is not identical to the basic time unit (normally a year).
2. If money supply increases by 15%, these two indexes also increase
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