Answer
Option A
At higher interest rate the quantity of money demanded is higher
because the opportunity cost of money increases and there is less
benefit to keep the money for transaction purposes as well as there
is little or no incentive to invest.
Money supply is independent of the interest rate because it is
controlled by the Fed because of that is it vertical.
This Question: 2 pts 29 of 62 (44 comp At higher interest rates the O A....
1. Which of the following properly describes the interest-rate effect? a. A higher price level leads to higher money demand, higher money demand leads to higher interest rates, and a higher interest rate increases the quantity of goods and services demanded.b. A higher price level leads to higher money demand, higher money demand leads to lower interest rates, and a lower interest rate reduces the quantity of goods and services demanded.c. A lower price level leads to lower money demand, lower...
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Incorrect Question 43 0/2 pts Because interest rates on government bonds reflect the risk of default, the historically high bond yields are signaling that government bonds are a risky investment. a country perceived as a higher credit risk can pay lower interest rates when it borrows. bond buyers are willing to accept lower interest payments for bonds perceived as high-risk investments. a country perceived as a higher credit risk must pay higher interest rates when it borrows. Incorrect...
Agritaban p us equity o 10 A Bank Make Money ily CAJ Pying higher interest rates on e s than we eamed on its assets Paying lower interest rates on its Babies than are eamed on i t s i) Making risky loans Dj Maintaining a high degree of liquidity 11. The Quantity Theory of Money (A) is based on the following equation: MVPO (Assumes that increases in money supply are deflationary (C) Assumes that the Velocity of Money is...
QUESTION 4 In February 2014, South Africa had an inflation interest rates in January and is expected to increase or maintain the interest rates through 2014. The South African central bank is pursuing rate of 5.9 % and an unemployment rate of 24.1%. The South African central bank raised a(n): contractionary monetary policy to contain inflation. expansionary monetary policy to contain inflation. expansionary monetary policy to fight unemployment. contractionary monetary policy to fight unemployment QUESTION 5 When the economy is sluggish, the Fed will: raise interest rates, which...
A consequence of hyperinflation is that people O A. receive higher real wage hikes, which increases their purchasing power for goods and services B. who make fixed-payment loans to others receive higher payments as inflation increases C. increase the quantity of money demanded O D. spend time trying to keep their money holdings near zero O E. want to lend funds because interest rates are so high. d select
QUESTION 6 The higher a higher, lower O b. lower, lower the nominal interest rate. st of processing a loan, the the interest rate charged for the loan; the lawer the expected inflation rate, the O c. lower, higher o d higher, higher QUESTION 7 If you place $10,000 in a savings account that pays 3 percent interest per year and you leave all the money, principal plus interest earned, in the account for three years, approximately how much money...
5 pts he sample sine be? OA 44 ОВ. 302 С. 62 O D. can't be determined without knowing how many students there are at the university Click to selact your answer
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Question Help 4.1.5 Which of the following values cannot be probabilities? 0.03, 1.38, 5/3. 2,0. -0.52,1. 3/5 Select all the values that cannot be probabilities. A. 5 B. 0 C. -0.52 D. 3 5 E. 2 F. 0.03 G. 1 H 1.38 3.3.33 Question Help Use the same s Use the boxplot ling data sets Pulse rates for men and women Click the i...
question 44
An increase in investment spending can be expected to the aggregate demand curve. interest rates and cause o increase; a rightward shift of O increase; an upward movement along O decrease; a downward movement along O decrease; a leftward shift of O have no effect on; no change in DQuestion 44 1 pts Money serves as a unit of account when goods have a value expressed in the same currency, thus allowing comparisons O O have a value...
$o and 4 units D $10 and 8 units D Question 36 2 pts When supply shifts left and demand shifts right. 0 the equilibrium quantity always rises. 0 the equilibrium price always rises. O the equilibrium quantity always falls. O the equilibrium price is indeterminate O the equilibrium price always falls. 2 pts Question 37