A. the effects of changes in money demand and supply on interest rates. B. the effects of changes in money demand and supply on exchange rates. C. the effects of wealth on expenditures. D. the difference between temporary and permanent changes in income.
A. short run and supposes that the price level adjusts to bring money supply and money demand into balance. B. short run and supposes that the interest rate adjusts to bring money supply and money demand into balance. C. long run and supposes that the price level adjusts to bring money supply and money demand into balance. D. long run and supposes that the interest rate adjusts to bring money supply and money demand into balance.
A. level of real GDP. B. rate of inflation. C. interest rate. D. the Federal Reserve.
A. if the money demand curve shifted right. B. if the Federal Reserve chose to increase money supply. C. if the interest rate increased. D. All of the above are correct.
A. increase, so the money supply increases. B. increase, so the money supply decreases. C. decrease, so the money supply increases. D. decrease, so the money supply decreases.
A. the relation between the price and interest rate of an asset. B. the risk of an asset relative to its selling price. C. the ease with which an asset is converted into a medium of exchange. D. the sensitivity of investment spending to changes in the interest rate.
A. the interest rate to fall so aggregate demand shifts right. B. the interest rate to fall so aggregate demand shifts left. C. the interest rate to rise so aggregate demand shifts right. D. the interest rate to rise so aggregate demand shifts left.
A. an increase in the interest rate reduces the quantity of money demanded. This is shown as a movement along the curve. An increase in the price level shifts money demand right. B. an increase in the interest rate increases the quantity of money demanded. This is shown as a movement along the curve. An increase in the price level shifts money demand left. C. an increase in the price level reduces the quantity of money demanded. This is shown as a movement along the curve. An increase in the interest rate shifts money demand right. D. an increase in the price level increases the quantity of money demanded. This is shown as a movement along the curve. An increase in the interest rate shifts money demand left.
A. interest rate B. money supply C. quantity of output D. price level
A. 2 percent. B. 3 percent. C. 4 percent. D. None of the above is correct.