It Is Costly to Hold Money Because

question 337

Multiple Choice

It is costly to hold money because

• A) deflation may reduce its purchasing power.
• B) in doing so, one sacrifices interest income.
• C) bond prices are highly variable.
• D) the rate at which money is spent may decline.

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Definitions:

Self-fulfilling Prophecy

A prediction that directly or indirectly causes itself to become true, due to positive feedback between belief and behavior.

Social Cognition

The study of how people process social information, including understanding others, social attitudes, and cognition in social contexts.

Attribution

The process of ascribing causes to behaviors and events, often influencing how individuals understand and react to the world around them.

Self-fulfilling Prophecy

A belief or expectation that an individual holds about a future event that manifests because the individual holds it.