Refer to the graph which shows the supply and demand for money where Dm1, Dm2, and Dm3 represent different demands for money and Sm1, Sm2, and Sm3 represent different levels of the money supply. The initial equilibrium point is A. What will be the new equilibrium point following a decrease in the money supply?





A. B



B. E



C. F



D. I


A. B

Economics

You might also like to view...

________ paid for the use of land; ________ paid for the services of labor; and ________ paid for the use of capital

A) Rent is; wages are; interest is B) Rent is; interest is; wages are C) Interest is; wages are; profit is D) Mortgages are; interest is; wages are E) Rent is; wages are; profit is

Economics

In the equation GDP = C + I + G + F, in which F equals net export spending (i.e., total spending on exports minus total spending on imports), imports are subtracted from the other types of expenditures because:

A) imports reduce national welfare. B) other countries do not import goods from the U.S. C) it represents a flow of expenditures out of the domestic economy to the rest of the world. D) the value of imports is difficult to determine due to the fact that they are frequently stated in terms of foreign currency.

Economics

When the exponents of a Cobb-Douglas production function sum to more than 1, the function exhibits

A) constant returns. B) increasing returns. C) decreasing returns. D) either increasing or decreasing returns.

Economics

A consumer's demand for a product decreases because other consumers own it. This would reflect: a. A bandwagon effect

b. a positive network externality. c. A snob effect. d. none of the above

Economics