The Advent of Interest-Earning Chequing Accounts in the Early 1980s

question 71

Essay

The advent of interest-earning chequing accounts in the early 1980s led many households to keep a larger proportion of their income in chequing accounts.Use the aggregate demand-aggregate supply model to illustrate graphically the impact in the short run and the long run of this change in money demand.Be sure to label:
i.the axes
ii.the curves
iii.the initial equilibrium values
iv.the direction the curves shift
v.the short-run equilibrium values
vi.the long-run equilibrium values.State in words what happens to prices and output in the short run and the long run.

---

Definitions:

Behavioral-Genetics

The study of the role genetic and environmental factors play in shaping behaviors, traits, and abilities.

Eye-Gaze Measures

Techniques used in psychological and neurological research to track where and how long a person looks at various stimuli, providing insights into attention and cognitive processes.

Communication Game

A structured activity or exercise designed to enhance interpersonal skills and improve the way individuals exchange information.

Chinese

Refers to anything related to China, including its language, culture, or people.