The key variable in monetarism is the velocity of money.
Answer the following statement true (T) or false (F)
True
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Economists have long pondered the reasons why people hold money. Some reasons seem to be more important than others. Perhaps not among the most important but still a reason why people hold money is for emergency purposes (the idea of having money available for that "rainy day"). Economist refer to that demand for money as
a. precautionary b. emergency c. speculative d. transactions e. temporary
The models of perfect competition and monopoly are the most realistic
a. True b. False Indicate whether the statement is true or false
The goldsmith's ability to create money was based on the fact that
A. withdrawals of gold tended to exceed deposits of gold in any given time period. B. consumers and merchants preferred to use gold for transactions, rather than paper money. C. the goldsmith was required to keep 100 percent gold reserves. D. paper money was rarely redeemed for gold.
Which has greater elasticity: a supply curve that goes through the origin with slope of 1 or a supply curve that goes through the origin with slope of 4?
A. The supply curve with slope of 4. Slope and elasticity are directly related so the higher the slope, the higher the elasticity. B. They both have the same elasticity. Any supply curve with a positive slope has the same elasticity. C. They both have the same elasticity. Any supply curve that goes through the origin has an elasticity of 1. D. The supply curve with slope of 1. Slope and elasticity are inversely related so the lower the slope, the higher the elasticity.