A Major Point of the Baumol-Tobin Model of the Transactions

question 103

Multiple Choice

A major point of the Baumol-Tobin model of the transactions demand for money is that they show that the

• A)demand for money is related to income.
• B)velocity of money is constant.
• C)fraction of income that people wish to hold in the form of money is constant.
• D)interest sensitivity of the demand for money is based on a transactions motive shared by most people.

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Definitions:

Visual Cliff

An experimental apparatus used to study perception of depth and fear of falling in infants, demonstrating their ability to perceive depth.

Navigate

The ability to plan and direct a route or course, especially by using instruments or maps, or metaphorically in making one's way through complex situations.

Heights

Measurements of vertical dimension or elevation, or the perceived vertical dimension of an object or place.

Visual Cliff

A research tool used to measure infants' perception of depth and their ability to perceive danger in simulated environments.