If Money Demand Is Extremely Sensitive to Changes in the Interest

question 74

Multiple Choice

If money demand is extremely sensitive to changes in the interest rate,the money demand curve becomes almost horizontal.If the Fed expands the money supply under these circumstances,then the interest rate will

• A)fall substantially and investment and consumer spending will fall substantially.
• B)rise substantially and investment and consumer spending will rise substantially.
• C)fall substantially and investment and consumer spending will change very little.
• D)change very little and investment and consumer spending will change very little.

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Definitions:

Performing Stage

The fourth stage of Tuckman's team development model where teams operate efficiently towards achieving their goals with high autonomy and harmony.

Adjourning Stage

The final phase in group development where the group concludes activities and members disband, as described in Tuckman's stages of team development.

Group Process

The way team members work together to accomplish tasks.

Team Effectiveness

measures how well a team works together to achieve its goals and objectives.