In Addition to

question 92

Multiple Choice

In addition to

• A)performing financial intermediation,banks are important in that they help create a medium of exchange.
• B)serving as financial markets,mutual funds are important in that they help create a store of value.
• C)serving as stores of value,stocks and bonds also serve as media of exchange.
• D)All of the above are correct.

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity of the good that consumers are willing and able to purchase at various prices.

Elasticity

A measure of how much the quantity demanded or supplied of a good responds to a change in one of its determinants, such as price.

Inferior Goods

Goods for which demand decreases as the income of the consumer increases, opposite to normal goods.

Normal Goods

Goods for which demand increases as the income of consumers increases, and vice versa, holding all other factors constant.