The demand for reserves increases as the price level rises because
A. people want money to buy goods that will appreciate with inflation.
B. people need more money to finance transactions.
C. the opportunity cost of holding money increases.
D. higher prices reduce the value of dollar assets.
Answer: B
Economics
You might also like to view...
Along the short-run aggregate supply curve (SRAS), an increase (rightward shift) in the aggregate demand curve will increase: a. both the price level and real GDP
b. real GDP without raising the price level. c. the price level without affecting real GDP. d. the price level but reduce real GDP.
Economics
The highest valued alternative option that must be given up in order to choose an action is called its
a. utility. b. opportunity cost. c. capital. d. ceteris paribus
Economics