When the Money Market Is Drawn with the Value of Money

question 180

Multiple Choice

When the money market is drawn with the value of money on the vertical axis,the money demand curve slopes

• A)upward,because at higher prices people want to hold more money.
• B)downward,because at higher prices people want to hold more money.
• C)downward,because at higher price people want to hold less money.
• D)upward,because at higher prices people want to hold less money.

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Definitions:

Supply Curves

A graphical representation that shows the relationship between the price of a good or service and the quantity that suppliers are willing to offer for sale at that price, over a given period.

Invisible Hand

A term coined by Adam Smith to describe the self-regulating nature of the marketplace where individuals pursuing their own self-interest lead to the benefit of society at large.

Comparative Advantage

The ability of a country, individual, company, or region to produce a good or service at a lower opportunity cost than its competitors.

Self-Interest

The pursuit of personal advantage and well-being, often driving economic decisions and behaviors.