When the money market is drawn with the value of money on the vertical axis, as the price level decreases, the value of money
a. increases, so the quantity of money demanded increases.
b. increases, so the quantity of money demanded decreases.
c. decreases, so the quantity of money demanded decreases.
d. decreases, so the quantity of money demanded increases.
b
You might also like to view...
Which of the following are typically financed in a "bond market"?
i. a mortgage for a house ii. state government borrowing for a new road project iii. your purchase of 4000 shares of stock in Google A) ii and iii B) ii only C) i only D) i and iii E) i and ii
Suppose real GDP for a country is $13 trillion in 2015, $14 trillion in 2016, $15 trillion in 2017, and $16 trillion in 2018. Over this time period, the real GDP growth rate is
A) increasing. B) decreasing. C) constant. D) negative.
An unregulated monopoly finds that its marginal cost exceeds its marginal revenue. In order to increase its profit, the firm will
A) raise its price and decrease its output. B) lower its price and increase its output. C) raise its price and increase its output. D) continue to produce this level of output because any change will lower its profit.
The demand curve for money:
a. shows the amount of money balances that individuals and businesses wish to hold at various levels of private investment. b. reflects the open market operations policy of the Federal Reserve. c. shows the amount of money that households and businesses wish to hold at various rates of interest. d. indicates the amount that consumers wish to borrow at a given interest rate.