When the Money Market Is Drawn with the Value of Money

question 315

Multiple Choice

When the money market is drawn with the value of money on the vertical axis, if there is a surplus of money then

• A)the value of money rises which will make people desire to hold more money.
• B)the value of money rises which will make people desire to hold less money.
• C)the value of money falls which will make people desire to hold more money.
• D)the value of money falls which will make people desire to hold less money.

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Definitions:

Assets

Resources owned or controlled by a business that are expected to produce economic value.

Liabilities

Financial obligations or debts that a company owes to external parties, which must be settled over time through the transfer of economic benefits including money, goods, or services.

Creditors

Individuals or entities that are owed money by a debtor because they have provided goods, services, or loans.

Statement Of Changes In Equity

A financial statement that shows how the equity of a company has changed over a period due to various factors like profits, losses, and distributions to shareholders.