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Circle any of the following variables that can be influenced by the monetary system: nominal GDP,...

  1. Circle any of the following variables that can be influenced by the monetary system: nominal GDP, real GDP, unemployment, nominal interest rate, real interest rate. (3 points)
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Answer #1

It is the nominal interest rate that can be influenced by the monetary system. The monetary system will be used to regulate the money supply and it will cause interest rate to increase or decrease. In money supply decreases, then interest rate increases. In money supply increases then interest rate decreases.

Indirectly, the change in interest rate will cause change in other macroeconomic indicators as well.

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