According to the Cambridge Approach to the Quantity Theory,people Hold

question 13

Multiple Choice

According to the Cambridge approach to the quantity theory,people hold money:

• A)to store their wealth.
• B)to make transactions.
• C)as a substitute for consumption.
• D)only when they have to.

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Definitions:

Utility Function

A mathematical representation of how consumer preferences over a set of goods and services are ranked.

Horizontal Axis

In a graphical representation, the x-axis, which typically shows the independent variable or the quantity of goods.

Vertical Axis

in a graph or chart, the y-axis which typically represents the range of values or dependent variables.

Perfect Substitute

Goods that can be completely replaced by another with no loss of utility to the consumer, such as different brands of sugar.