1. If the nominal interest rate is 8% and the expected inflation rate is 3% then the real interest rate is.....% (approximately).

If NGDP is 12,000 and the money supply is 300 then velocity is....

1. Inflation (at least in the long run) is caused by......(output/velocity/ the money supply/ scarcity)
2. Let the CPI for some country be 202 in one year and then 216 the next.What is the inflation rate? (Answer as a decimal.Round to three decimal places.)
3. Imagine that George agrees to lend Ringo $100 at a nominal interest rate of 10% while both of them expect the inflation rate to be 2%.However, theactualinflation rate ends up being 5%.This mistaken expectation makes George.....(better off/ worse off/ neither) and Ringo.....(better off/ worse off/ neither)
4. When people mistake changes in nominal prices for changes in real prices, we call this.....
5. In the long run, money is ______________________.

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