Suppose a new law imposes a tax on all trades of bonds and stock. What is the likely effect on money demand?
A) Money demand declines first, then rises when inflation increases.
B) Money demand rises.
C) The overall effect is ambiguous.
D) Money demand declines.
B
You might also like to view...
Explain how the marginal product and average product of labor change as the labor employed increases (a) initially and (b) eventually
What will be an ideal response?
Suppose that Carol owns a property with a mineral spring. It costs zero for Carol to sell water to customers since buyers come to her property and bring their own bottles and fill them themselves. If Carol wants to maximize her profits from the sale of her mineral water, she should choose the output level
A. where the demand curve for water hits the vertical axis. B. where demand is inelastic. C. where demand is unit elastic. D. demand is exhausted.
Define investment? The meaning of investment is different for economists. Explain
Describe the difference between positive and negative incentives. Give an example of each.
What will be an ideal response?