In the Money Market, in the Short Run If the Quantity

question 102

Multiple Choice

In the money market, in the short run if the quantity of money exceeds the quantity of money demanded, then to achieve equilibrium the

• A)inflation rate increases.
• B)demand for money increases.
• C)price level rises.
• D)nominal interest rate falls.
• E)supply of money increases.

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Definitions:

Allowance Account

A contra account related to accounts receivable that estimates the amount of receivables which may not be collected.

Allowance for Doubtful Accounts

This accounting practice represents a reserve for accounts receivable that may not be collectible, reflecting potential future losses due to credit sales.

Debit Balance

A debit balance is the remaining amount of money in an account, typically a bank account or a business's financial account, after all debits have been accounted for.

Credit Balance

A situation in financial accounts where the amount of credits exceeds the amount of debits, indicating an amount owed to the account holder.