Contractionary Monetary Policy,assuming Demand for the Currency Stays Constant,tends to Result

question 53

Multiple Choice

Contractionary monetary policy,assuming demand for the currency stays constant,tends to result in:

• A) a currency depreciation.
• B) a currency appreciation.
• C) no change in exchange rates.
• D) a change in only real,not nominal,exchange rates.

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Definitions:

Bank Loan

A sum of money lent at interest by a bank to a borrower, usually on collateral security, for a certain period.

Collection Float

The time period between when a check is deposited and when the funds are made available.

Chequing Account

A bank account from which money can be withdrawn without notice, typically used for day-to-day spending and bill payments.

Deposit

A deposit refers to a sum of money placed into an account or given to another party as security for future transactions, often used in banking, leasing, and rental agreements.