Holding money to meet unplanned expenditures and emergencies is known as
A. precautionary demand.
B. transactions demand.
C. aggregate demand.
D. speculative demand.
Answer: A
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What are the economic effects of a currency appreciation?
A. It will decrease aggregate demand and aggregate supply, so that output will certainly fall, and prices may fall as well. B. It will increase aggregate demand and aggregate supply, so that output will certainly rise, and prices may rise as well. C. It will increase aggregate demand and decrease aggregate supply, so that prices will certainly rise, and output may rise as well. D. It will decrease aggregate demand and increase aggregate supply, so that prices will certainly fall, and output may fall as well.
If quantity demanded is greater than quantity supplied, the market price must be
a. above equilibrium. b. at equilibrium. c. below equilibrium. d. above cost of production.
Which of the following statements is correct?
A) Arc elasticity of demand is the same as the slope of the demand curve. B) Arc elasticity of demand only applies to a nonlinear demand curve. C) Point elasticity of demand is measured at each point along a demand curve. D) Point elasticity of demand is measured between two adjacent points on a demand curve.
The amount of deadweight loss from a tax depends upon the
a. price elasticity of demand. b. price elasticity of supply. c. amount of the tax per unit. d. All of the above are correct.