Have a question?
Message sent Close

Economy (Ecn510) Questions And Answers

Instructor
Sandra Watson
0
0 reviews
  • Description
  • Full Document
Blur-Preview

the asset demand for money is most closely related to money functioning as a

Ryerson University

Economy (Ecn510)

1. The transactions demand for money is most closely related to money functioning as a:
A. unit of account.
B. medium of exchange.
C. store of value.
D. measure of value.

2. The asset demand for money is most closely related to money functioning as a:
A. unit of account.
B. medium of exchange.
C. store of value.
D. measure of value

3. The desire to hold money for transactions purposes arises because:
A. receipts of income and expenditures are not perfectly synchronized.
B. people fear that prices will rise.
C. households want money on hand in case a good financial investment opportunity arises.
D. low interest rates reduce the opportunity cost of holding money.
Points Earned: 0/1
Correct Answer: A
Your Response:
4. The asset demand for money:
A. is unrelated to both the interest rate and the level of GDP.
B. varies inversely with the rate of interest.
C. varies inversely with the level of real GDP.
D. varies directly with the level of nominal GDP.
Points Earned:

5. On a diagram where the interest rate and the quantity of money demanded are shown on the
vertical and horizontal axes respectively, the transactions demand for money can be represented
by:

6. On a diagram where the interest rate and the quantity of money demanded are shown on the
vertical and horizontal axes respectively, the asset demand for money can be represented by:
A. a line parallel to the horizontal axis.
B. a vertical line.
C. a downsloping line or curve from left to right.
D. an upsloping line or curve from left to right.

8. The total demand for money curve will shift to the right as a result of:
A. an increase in nominal GDP.
B. an increase in the interest rate.
C. a decline in the interest rate.
D. a decline in nominal GDP.

9. Which of the following statements is correct? Other things equal:
A. a decline in real output will shift both the transactions demand curve for money and the total
money demand curve to the right.
B. a decline in the interest rate will shift the asset demand curve for money to the right, but leave
the total money demand curve unchanged.
C. deflation will shift both the transactions demand curve for money and the total money demand
curve to the left.
D. inflation will shift the transactions demand curve for money to the right, but leave the total
money demand curve unchanged

10. If nominal GDP is $600 billion and, on the average, each dollar is spent three times per year,
then the amount of money demanded for transactions purposes will be:

PREVIEW

 

Economy (Ecn510) Questions And Answers

NOTE: Please check the details before purchasing the document.

error: