In Response to the Early Keynesians,monetarists Contended That

question 55

Multiple Choice

In response to the early Keynesians,monetarists contended that

• A)monetary policy during the Great Depression was not easy.
• B)bank failures during the Great Depression were not the cause of the decline in the money supply.
• C)evidence from the Great Depression demonstrated the ineffectiveness of monetary policy.
• D)there is a weak link between interest rates and investment spending.

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Definitions:

Compounded Interest

Interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.

Compounded Continuously

Pertains to the situation where interest is added to the principal balance of an investment, loan, etc., at an infinite number of times within a specified time period.

Balance

The equality between the sum of the debits and credits in an account, or the stability between opposing forces.

Compounded Annually

Refers to interest calculated once a year on the principal, including any previously earned interest.