The demand for money ________ when the ________
A) increases; nominal interest rate increases
B) decreases; price level increases
C) increases; supply of money decreases
D) remains constant; price level increases
E) increases; price level increases
E
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The demand curve shown in the figure above is ________ over the price range from $95 to $105 per unit
A) perfectly elastic B) perfectly inelastic C) unit elastic D) elastic but not perfectly elastic E) inelastic but not perfectly inelastic
At Christmastime, individuals choose to hold more cash and fewer deposits to facilitate their Christmas shopping. This condition will
A) increase the money supply, for people will be spending more money. B) have no effect on the money supply because people are just exchanging one form of money (deposits) for another form (cash). C) reduce the money supply because there will be a drain of reserves out of the banks. D) reduce the money supply, for all that cash is spent on Christmas presents.