Which of the Following Increases the Quantity of Money

question 113

Multiple Choice

Which of the following increases the quantity of money?

• A) the Fedʹs purchase of a government security
• B) an increase in the governmentʹs budget deficit
• C) an individualʹs purchase of a government security from the Fed
• D) an individualʹs cash withdrawal from a bank

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Definitions:

Joint Monthly Profit

The combined profit earned by two or more partners or businesses in a single month.

Cartel

An organization of sellers designed to coordinate supply and price decisions so that the joint profits of the members will be maximized. A cartel will seek to create a monopoly in the market for its product.

Monopolist

A single seller in a market who has significant control over the price and supply of a product or service.

AVC

Average Variable Cost; the total variable costs of production divided by the quantity of output produced.