Everything else held constant, an increase in the currency ratio will mean ________ in the M2 money multiplier and ________ in the M2 money supply
A) an increase; an increase
B) an increase; a decrease
C) a decrease; an increase
D) a decrease; a decrease
D
You might also like to view...
If the current market price is above the equilibrium price, then:
a. the quantity demanded exceeds the quantity supplied. b. there will be a shortage. c. the quantity supplied will exceed the quantity demanded. d. the price will have to increase to establish equilibrium. e. demand will shift to the left.
Which of the following is true when the velocity of money falls?
a) an increase in the money supply will have less effect on nominal gross national product b) a change in the money supply will affect output only c) the fed will decrease the money supply d) output will be greater for a given money supply e) the public will increase its holdings of assets other than money
For the cost function C(Q) = 50 + 4Q + 2Q2, the total variable cost of producing 7 units of output is:
A. 126. B. 32. C. 102. D. None of the answers are correct.
Which of the following explains why the demand for money curve has an inverse relationship between the interest rates and the quantity of money demanded?
A. As the interest rate rises, the opportunity cost of holding money rises, and people respond by converting cash or checking account balances into interest-bearing financial investments. B. As the interest rate rises, people find it advantageous to borrow money, which increases the quantity of money demanded. C. As the interest rate falls, the opportunity cost of holding money rises, and people respond by converting cash or checking account balances into interest-bearing financial investments. D. As the interest rate rises, the demand for money curve shifts outward to the right.