The transactions demand for money will increase when
A) the rate of interest increases.
B) the price level falls.
C) nominal Gross Domestic Product (GDP) increases.
D) nominal Gross Domestic Product (GDP) decreases.
C
Economics
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Discuss the relationship between PPP and the Law of One Price
What will be an ideal response?
Economics
Suppose that real GDP is initially $13 trillion and the government attempts to increase real GDP to $14 trillion
The marginal propensity to consume is 0.75, and every $1.00 increase in real government spending crowds out $0.50 in real planned investment expenditures. How much increase in real government spending could lead to the desired level of real GDP? A) $200 billion B) $250 billion C) $500 billion D) $1 trillion
Economics