If a Person Is Holding Money for the Purchase of Goods

question 87

Multiple Choice

If a person is holding money for the purchase of goods and services,this demand for money is known as

• A)speculative demand.
• B)precautionary demand.
• C)transactions demand.
• D)real balance demand.
• E)nominal balance demand.

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Definitions:

Wealth of Consumers

The total value of all assets owned by consumers minus any liabilities; it reflects the economic resources available to consumers.

Aggregate Supply Curve

A graphical representation of the relationship between the overall price level and the total output produced by an economy.

Aggregate Demand Curve

A graph showing the relationship between the total demand for goods and services and the overall price level in the economy, all else being equal.

Real GDP

Gross Domestic Product adjusted for inflation, providing a more accurate reflection of an economy’s size and growth rate.