If the Amount of Money Demanded Exceeds the Amount Supplied

question 366

Multiple Choice

If the amount of money demanded exceeds the amount supplied, the

• A) demand-for-money curve will shift to the left.
• B) money-supply curve will shift to the right.
• C) interest rate will rise.
• D) interest rate will fall.

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Definitions:

Par Value

A nominal value assigned to a security, such as a stock, which is stated in the corporate charter and often bears no relation to its market value.

Price-Earnings Ratio

A valuation metric for a company's current share price relative to its per-share earnings, indicating how much investors are willing to pay for each dollar of earnings.

Earnings Per Share

A financial metric that calculates the portion of a company's profit allocated to each outstanding share of common stock.

Market Price

The present cost at which a service or asset is available for purchase or sale.