Of the Four Effects on Interest Rates from an Increase

question 62

Multiple Choice

Of the four effects on interest rates from an increase in the money supply,the one that works in the opposite direction of the other three is the

• A)liquidity effect.
• B)income effect.
• C)price level effect.
• D)expected inflation effect.

---

Definitions:

Residual Value

The estimated value that an asset will have at the end of its useful life, also known as salvage value.

Gain Or Loss

The difference between the selling price and the purchase price of an asset, resulting in a financial profit or loss.

Disposal Of Equipment

The process of selling, scrapping, or eliminating machinery or equipment that is no longer needed.

Book Value

The value of a company based on its financial statements, calculated by assets minus liabilities.