According to Liquidity-Preference Theory, When Would the Money-Supply Curve Shift

question 105

Multiple Choice

According to liquidity-preference theory, when would the money-supply curve shift right?

• A) if government spending increased
• B) only if the Bank of Canada chose to increase the money supply
• C) if the interest rate decreased
• D) if the price level fell

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Definitions:

Vice President

A senior management position in a company or organization, reporting directly to the President or CEO, responsible for a specific division or function.

Primary Market Transaction

The initial issuance and sale of securities directly from the issuer to investors, distinguishing from secondary market transactions where securities are bought and sold among investors.

IPO

Initial Public Offering, the process by which a private company becomes publicly traded by offering its shares for sale to the general public for the first time.

Public

Relating to or involving the people as a whole; often used to describe companies whose shares are available to be bought and sold by the general population.