The Demand for Money Increases and the Demand for Money

question 13

Multiple Choice

The demand for money increases and the demand for money curve shifts rightward if

• A)real GDP increases.
• B)the nominal interest rate increases.
• C)the inflation rate increases.
• D)the real interest rate increases.
• E)the price level falls.

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Definitions:

Capital Investment

Funds invested in a firm or enterprise for the purpose of furthering its business objectives, including purchasing assets or stocks.

Short-Run

A timeframe in which a company cannot alter at least one of its resources.

Economic Profit

The difference between the total revenue earned by a firm and the total cost of inputs, including both explicit and implicit costs.

Implicit Costs

The opportunity costs of utilizing resources owned by the firm that could have been employed for other purposes.