Which of the following will cause a reduction in the amount of money individuals wish to hold?
A. an increase in the price level
B. an increase in income
C. an increase in the interest rate
D. all of these
Answer: C
You might also like to view...
________ occurs when actions taken by one party to a transaction are different from what the other party expected at the time of the transaction
A) Adverse selection B) Risk aversion C) Moral hazard D) Fraud
Explicit agreements between businesses to keep prices high:
A. are illegal. B. are not in the public's best interests. C. are called collusion. D. All of these statements are true.
If the demand for money decreases, ceteris paribus, the LM curve would:
A) shift right. B) shift left. C) remain constant. D) slope more steeply.
P-TV and QRS-TV are trying to decide whether to air a sitcom or a reality show in a given time slot. Viewers like both sitcoms and reality shows, but sitcoms are more expensive to produce than reality shows since real actors need to be hired. QRS-TV makes its decision first, and then P-TV observes that choice before making its decision. Both stations know all of the information in the decision tree below.
Given the information in this decision tree, if QRS-TV announces that it will air a sitcom, it can expect to:
A. earn $20 million. B. earn $5 million. C. lose $5 million. D. earn $10 million.