According to Keynes, the money demand function
a. did not change as the return on other assets changed.
b. changes with output.
c. shifts with changes in the public confidence in the economy.
d. both b and c.
e. all of the above.
C
You might also like to view...
Should European nations which are not currently using the euro choose to adopt the euro as their currency, these countries would risk giving up the ability to use ________ to stabilize their economies in the event of a recession
A) contractionary fiscal policy B) expansionary monetary policy C) expansionary fiscal policy D) contractionary monetary policy
What is the main reason why monetary policy has a stronger effect in an open economy than in a closed economy?
a. Changes in the price level affect net exports. b. Changes in the price level affect exchange rates. c. Changes in exchange rates affect output. d. Changes in the interest rate affect exchange rates which, in turn, affect net exports. e. Changes in exchange rates affect the interest rate which, in turn, affects net exports.
If expected inflation were 2%, and teh real interest rate was 5%, what sector would be worse off if the actual inflation rate turned out to be 6%
a. Lenders. b. Borrowers. c. Both. d. None.
What does efficiency mean?
a) Society is conserving resources in order to save them for the future b) Society's goods and services are distributed fairly among society's members c) Society has lessened its dependence on foreign energy sources d) Society is getting the most it can from its scarce resources