If Money Demand Is Infinite Below Some Certain R (E

question 30

Multiple Choice

If money demand is infinite below some certain r (e.g., r*) and zero above r*, then the LM curve is ______ and ______ policy has no effect on output.

• A) vertical; fiscal
• B) horizontal; fiscal
• C) vertical; monetary
• D) horizontal; monetary

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Definitions:

Public Ownership

The ownership of assets by the government or public entities rather than by private individuals or companies.

Productive Resources

The factors required for the production of goods and services, usually classified into land, labor, capital, and entrepreneurship.

Self-Interest

The personal interest or advantage that individuals seek to maximize their own welfare or benefit.

Public Good

A product or service that is available for all people to consume, regardless of who pays for it, and where one person's consumption does not reduce availability to others.