If households and firms decide to hold less of their money in checking account deposits and more in currency, then initially, the money supply

A) will decrease. B) will not change.
C) will increase. D) may increase or decrease.


B

Economics

You might also like to view...

Refer to Figure 10-1. When the price of hoagies increases from $5.00 to $5.75, quantity demanded decreases from Q1 to Q0. This change in quantity demanded is due to

A) the fact that marginal willingness to pay falls. B) the law of diminishing marginal utility. C) the income and substitution effects. D) the price and output effects.

Economics

If Option A costs $40 and yields 20 units of output and Option B costs $50 and yields 30 units of output,

A) Option B and Option A are equally economically efficient. B) Option B is economically efficient relative to Option A. C) Option A is economically efficient relative to Option B. D) It is not possible to determine which option is more economically efficient.

Economics

One problem with the effectiveness of Pigovian taxes is:

A. the tax does not directly compensate those who are affected by the externality. B. knowing whether to impose it on the consumer or producer. C. the tax is always used to benefit those who bear the externalities. D. none of the above is a problem of Pigovian taxes.

Economics

The country with the highest child poverty rate in the industrial world is __________.

Fill in the blank(s) with the appropriate word(s).

Economics