The Money Demand Curve Will Shift to the Left When

question 10

Multiple Choice

The money demand curve will shift to the left when which of the following occurs?

• A)a reduction in the interest rate
• B)an increase in the interest rate
• C)an open market sale of bonds by the central bank
• D)an increase in income
• E) none of the above

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Definitions:

Lottery

A form of gambling that involves drawing numbers at random for a prize, often run by states or organizations as a way to raise funds.

Federal Reserve

The central banking system of the United States, responsible for implementing the country's monetary policy.

Consumer Spending

The aggregate spending of families within an economy on goods and services.

45-Degree Line

A reference line in economics, usually on a graph, where all points along the line indicate where the values for the variables on the axes are equal.