The efficiency of the payments’ mechanism affects
A. the speed with which money can be exchanged for other assets.
B. how quickly individual loan applications will be approved.
C. how slowly individuals deplete their cash balances.
D. the speed with which financial institutions can process checks and other funds.
Answer: D
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Fiscal policy affects the economy
A. only in the short run. B. only in the long run. C. in both the short and long run. D. in neither the short nor the long run.
The income effect refers to a change in:
A. income because of changes in the CPI. B. the quantity demanded of a good because of a change in the buyer's real income. C. the quantity demanded of a good because of a change in the buyer's money income. D. price of a good because of a change in the buyer's real income.