Figure 30-2

question 125

Multiple Choice

Figure 30-2.On the graph,MS represents the money supply and MD represents money demand.The usual quantities are measured along the axes.
-Refer to Figure 30-2.If the relevant money-demand curve is the one labeled MD₁,then the equilibrium value of money is

• A)0.5 and the equilibrium price level is 2.
• B)2 and the equilibrium price level is 0.5.
• C)0.5 and the equilibrium price level cannot be determined from the graph.
• D)2 and the equilibrium price level cannot be determined from the graph.

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Definitions:

Gain Or Loss

The positive or negative financial result obtained from an investment, sale of assets, or other transactions, compared to the original cost.

Installment Note

A loan that requires regular payments, or installments, of principal and interest over a set period, often used for buying large, expensive items.

Journal Entry

A record in accounting that represents a transaction or financial event affecting the entity's financial statements, involving at least one debit and one credit.

Annual Year-End

The conclusion of a 12-month financial year period on which a company's annual financial statements are based.