Use the following graph to answer the next question.
The graph shows the supply and demand for money where Dm1, Dm2, and Dm3 represent different demands for money and Sm1, Sm2, and Sm3 represent different levels of the money supply. The initial equilibrium point is A. What will be the new equilibrium point following a decrease in the transactions demand for money?
A. I
B. B
C. E
D. F
Answer: D
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Doctors demand large salaries in part because
a. they are forbidden by U.S. law from receiving economic rent. b. most doctors have backward-bending labor supply curves. c. they participate in the secondary labor market. d. they have made significant investments in human capital.
In 2008, interest rates on Treasury securities fell even though most other interest rates were rising
a. True b. False Indicate whether the statement is true or false
An investment in an economy's human and physical capital results in an increase in the: a. supply of money
b. inflation rate in the economy. c. gross domestic product of the economy. d. level of foreign reserves in the economy.
Suppose a firm is hiring resources l and m under purely competitive conditions to produce product Y, which sells for $2 in a purely competitive market. The prices of l and m are $10 and $4 respectively. In equilibrium the MPs of l and m, respectively,
are: A. 1 and 1. B. 2 and 5. C. 10 and 4. D. 5 and 2.