In One of the Earliest Studies on the Link Between

question 33

Multiple Choice

In one of the earliest studies on the link between interest rates and money demand using United States data,James Tobin concluded that the demand for money is

• A)sensitive to interest rates.
• B)not sensitive to interest rates.
• C)not sensitive to changes in income.
• D)not sensitive to changes in bond values.

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Definitions:

Operating Capacity

The maximum output that a business can produce using its current resources and facilities without additional investment.

Dividend Payout Ratio

A financial metric that measures the percentage of a company's earnings paid to shareholders in the form of dividends.

Projected Fixed Assets

Estimates of the value of long-term assets that a company plans to acquire and use for more than one year, for purposes such as production or administration.

Sales Capacity

The maximum amount of sales a company can achieve within a given period, based on its resources and market demand.