The asset demand for money is affected by:

A. Interest rates
B. Prices
C. Incomes
D. Investment
E. Savings


Answer: A. Interest rates

Economics

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A surplus in a country's trade balance means that:

a. its net exports exceed transfer payments. b. the country's currency is over-valued. c. the value of its net exports is positive. d. imports into the country exceed exports. e. domestic savings exceeds domestic investment.

Economics

The short run is not the same length of time for all firms and industries because: a. entrepreneurs have different tastes and preferences

b. the average product of labor varies across industries. c. the life span of capital and the extent of capital specialization will vary across firms and industries. d. The marginal product of capital begins to diminish at different levels of capital utilization across firms.

Economics

If a firm is a price taker and wants to earn as much profit as possible, it should expand output

a. to the quantity at which marginal cost is minimized. b. as long as marginal cost is less than price. c. to the quantity at which average total costs are minimized. d. to try to sell all the output it can produce so that its average fixed costs will be minimized.

Economics

If velocity is constant in the long run, which of the following results flow from the quantity theory of money?

A) A change in the money supply changes real GDP by an equal percentage. B) A change in the money supply changes nominal GDP by an equal percentage. C) A change in the money supply changes real interest rates by an equal percentage. D) A change in the money supply changes consumer lending by an equal percentage.

Economics