Empirical Studies Done on Money Demand Established That

question 40

Multiple Choice

Empirical studies done on money demand established that

• A)the income elasticity of money demand (M1)is greater than 1
• B)the income elasticity of money demand (M1) is equal to 1
• C)the income elasticity of money demand (M1) is larger in the long run than in the short run
• D)the interest elasticity of money demand (M1)is close to -1
• E)none of the above

---

Definitions:

Utilitarians

Advocates of utilitarianism, a theory in ethics which states that the best action is the one that maximizes utility, usually defined as that which produces the greatest well-being of the greatest number of people.

God

God is a supreme being worshipped in various religions and spiritual traditions, often perceived as the creator and overseer of the universe and source of moral authority.

Rule Utilitarian

A person who believes that the best moral action is the one that follows a set of rules, assuming those rules lead to the greatest good for the greatest number when generally applied.

Greatest Happiness

The foundational concept of utilitarianism that proposes actions are right if they aim to promote the greatest happiness for the greatest number of people.