According to liquidity preference theory, the money supply curve would shift right
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.
查看答案
When the Fed buys government bonds, the reserves of the banking system
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.
Liquidity refers to
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.
According to liquidity preference theory, an increase in money demand for some reason other than a change in the price level causes
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.
According to liquidity preference theory,
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.