The quantity theory of money is a theory of how:
a. the money supply is determined
b. the real value of aggregate income is determined
c. interest rates are determined
d. the nominal value of aggregate income is determined
the nominal value of aggregate income is determined
The average nu...
Best Grades | Must Pass | Latest Update | Correct Answers | 2024/ 2025
ECO 4223 Exam 3 Questions and Correct
Answers | Latest Update
The quantity theory of money is a theory of how:
a. the money supply is determined
b. the real value of aggregate income is determined
c. interest rates are determined
d. the nominal value of aggregate income is determined
the nominal value of aggregate income is determined
The average number of times that a dollar is spent in buying the total amount of final goods
and services produced during a given time period is known as:
a. velocity
b. spending multiplier
c. gross national product
d. the money multiplier
velocity
If the money supply is $500 and nominal income is $3,000 the velocity of money is:
a. 1/60
b. 60
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, Best Grades | Must Pass | Latest Update | Correct Answers | 2024/ 2025
c. 1/6
d. 6
6
The equation of exchange states that the quantity of money multiplied by the number of times
this money is spent in a given year must equal:
a. velocity
b. real income
c. nominal income
d. real gross national product
nominal income
Fisher's quantity theory of money suggests that the demand for money is purely a function of
______, and _________ not effect on the demand for money.
a. government spending, interest rates have
b. income, interest rates have
c. interest rates, income has
d. expectations, income has
income, interest rates have
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Keynes hypothesized that the transactions component of money demand was primarily
determined by the level of:
a. income
b. velocity
c. stock market values
d. interest rates
income
Keynes argues that the transactions component of the demand for money was primarily
determined by the level of people's _______, which he believed were proportional to
______.
a. incomes, age
b. transactions, age
c. incomes; wealth
d. transactions, income
transactions, income
Of the three motives for holding money suggested by Keynes, which did he believe to be the
most sensitive to interest rates?
a. transactions motive
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