What is demand deposit?
What will be an ideal response?
Answer: A demand deposit is another name for a checking account because the money may be withdrawn at any moment.
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If the MPC in an economy is 0.75, government could shift the aggregate demand curve leftward by $60 billion by
A. reducing government purchases by $60 billion. B. reducing government purchases by $12 billion. C. increasing taxes by $15 billion. D. increasing taxes by $20 billion.
Increasing returns to scale result when
A) in the long-run, an increase in inputs will lead to an increase in the average products of inputs. B) in the long run, an increase in inputs will lead to an equivalent increase in output. C) labor becomes more skilled. D) All of the above
Why is the time lag for making fiscal policy changes longer than for making monetary policy changes?
Skateboards are produced according to the production function, q = 10K0.25L0.5 - L. At what quantity of labor does total product begin to decline given that capital is fixed at 16 units in the short-run?
A) L = 100. B) L = 10. C) L = 5. D) Not enough information is given.