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Author Question: Assume that the demand for money depends on the interest rate. A decrease in the money supply will cause (Read 108 times)

Sportsfan2111

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Question 1

If the demand for money depends on the interest rate, then a 15% increase in the money supply will increase


◦ nominal GDP by 15%.
◦ nominal GDP by less than 15%.
◦ nominal GDP by more than 30%.
◦ real GDP by 30%.

Question 2

Assume that the demand for money depends on the interest rate. A decrease in the money supply will cause


◦ the interest rate to increase, the quantity demanded of money to decrease, and the velocity of money to decrease.
◦ the interest rate to increase, the quantity demanded of money to decrease, and the velocity of money to increase.
◦ the interest rate to decrease, the quantity demanded of money to decrease, and the velocity of money to increase.
◦ the interest rate to decrease, the quantity demanded of money to increase, and the velocity of money to decrease.


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Marked as best answer by Sportsfan2111 on Apr 19, 2019

mjbamaung

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