According to Liquidity Preference Theory

question 15

Multiple Choice

According to liquidity preference theory,

• A)an increase in the interest rate reduces the quantity of money demanded.This is shown as a movement along the curve.An increase in the price level shifts money demand right.
• B)an increase in the interest rate increases the quantity of money demanded.This is shown as a movement along the curve.An increase in the price level shifts money demand left.
• C)an increase in the price level reduces the quantity of money demanded.This is shown as a movement along the curve.An increase in the interest rate shifts money demand right.
• D)an increase in the price level increases the quantity of money demanded.This is shown as a movement along the curve.An increase in the interest rate shifts money demand left.

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Definitions:

Justification Reports

Documents that provide reasons and evidence to support a particular action, decision, or proposal.

Proposals

Documents or presentations that offer a plan or suggestion, aiming to persuade the recipient to take a specific course of action.

Memo Format

A structured method of communication typically used within organizations to convey information or directives in a concise manner.

Direct Approach

A communication style that involves stating the main point or objective at the beginning, often used in clear and straightforward situations.