According to Liquidity Preference Theory, When Do People Demand Fewer

question 3

Multiple Choice

According to liquidity preference theory, when do people demand fewer goods and services?

• A) when the price level or interest rate increase
• B) when the price level or interest rate decrease
• C) when the price level increases or the interest rate decreases
• D) when the price level decreases or the interest rate increases

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Definitions:

SMART Goal

A framework for setting objectives that are Specific, Measurable, Achievable, Relevant, and Time-bound, facilitating clear and attainable goal-setting.

Specific

Pertaining to a distinct or particular item, characteristic, or quality, clearly defined or identified.

Maslow's Hierarchy

A theory of psychological health predicated on fulfilling innate human needs in priority, culminating in self-actualization.

Materialism

The tendency to consider material possessions and physical comfort as more important than spiritual values.