A Movement Upward and to the Left Along the Money

question 80

Multiple Choice

A movement upward and to the left along the money demand curve is caused by:

• A)an increase in the interest rate.
• B)a decrease in the interest rate.
• C)a decrease in real GDP.
• D)an increase in real GDP.
• E)an increase in the average price level.

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Definitions:

Opportunity Cost

The expense incurred by not choosing the second-best option while deciding.

Monthly Cash Flows

The total amount of money being transferred into and out of a business, particularly during a month.

Lockbox System

A system used by companies to expedite the collection of check payments by having them processed through a bank's PO Box.

Treasury Bills

Short-term government securities issued at a discount from the face value and maturing at their face value to create a return to the investors.