In the above figure, suppose the economy is initially on the demand for money curve MD1. What is the effect of an increase in the use of credit cards?
A) The demand for money curve would shift rightward to MD2.
B) The demand for money curve would shift leftward to MD0.
C) There would be a movement upward along the demand for money curve MD1.
D) There would be a movement downward along the demand for money curve MD1.
B
You might also like to view...
What are the basic arguments of the neoclassical growth theory?
What will be an ideal response?
Virtually all firms expend resources to do precise calculations of marginal cost and marginal revenue for decision making.
Answer the following statement true (T) or false (F)
The excess demand created when the government imposes a price ceiling
a. shifts the equilibrium price upward to the price ceiling level b. is the difference between the quantity demanded at the old equilibrium price and quantity supplied at the price set by the price ceiling c. is the difference between the quantity demanded at the price set by the price ceiling and quantity supplied at the old equilibrium price d. is the difference between the quantity demanded at the price set by the price ceiling and quantity supplied at the price set by the price ceiling e. is the difference between the old equilibrium price and the price set by the price ceiling
Which of the following statements best illustrates the time-value of money concept?
A. Bob is willing to forgo receiving $100 today in order to receive $110 next month. B. Tom is indifferent between receiving $50 now and receiving $50 six months from now. C. Terry works for an hourly wage instead of a fixed salary. D. Jeff would prefer to receive $200 at the end of the year instead of $220 now.