Holding nominal money balances constant, a decrease in the price level
A. causes the real value of the money balances to increase, in turn increasing total planned real expenditures.
B. causes the real value of the money balances to increase, thereby increasing the interest rate.
C. generates a reduction in the value of the money balances, leading to higher interest rates and a decrease in total planned real expenditures.
D. causes the real value of the money balances to decrease, in turn decreasing total planned real expenditures.
Answer: A
You might also like to view...
If the company plans to produce 9 units, which technology should the firm choose?
a. Technology A b. Technology B c. Either technology because they are equally cost efficient d. Need more information
The essence of competitive strategy includes which of these?
a. management-based capabilities b. resource=based capabilities c. business processes d. adaptive innovation e. a, b & c f. b, c & d Indicate whether the statement is true or false
When viewed as a tangible asset, real estate can be defined as the land and its permanent improvements. Improvements on the land include:
A. fences B. walkways C. sewer systems D. streets
By the third quarter of 2011, U.S. households had accumulated $6.2 trillion in housing equity, which represents about 11 percent of their net worth. What proportion of U.S. households own their home?
A. one-third B. one-half C. two-thirds D. three-fourths