In the Liquidity Preference Model, What Adjusts to Move the Money

question 121

Multiple Choice

In the liquidity preference model, what adjusts to move the money market to equilibrium following a change in the money supply?

• A) planned spending
• B) the interest rate
• C) production
• D) the price level

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Definitions:

Cognitive Dissonance Reduction

The process of resolving the discomfort caused by holding two or more conflicting cognitions (beliefs, attitudes) by changing, adding, or minimizing one of the discordant factors.

Defective

A term used to describe something that is imperfect or lacking in some component, making it not fully functional.

Staples

Metal wire or plastic pieces used to bind materials together, typically papers or the edges of wounds in medical suturing.

Central Route

A method of persuasion that involves careful and thoughtful consideration of the arguments presented, leading to lasting attitude change.