The effect whereby an increase in the money supply decreases the nominal interest rate in the short run is:
a. the income effect
b. the liquidity effect
c. the price-level effect
d. the expected inflation effect
19. Suppose the government guarantees today that it will pay creditors if corporations go bankrupt. Then interest rate yields on corporate bond and government bonds:
a. increase, decrease
b. decrease, decrease
c. increase, increase
d. decrease, increase.