Please Answer Both! Thank you! The main reason people hold money is that Questio
ID: 1173917 • Letter: P
Question
Please Answer Both! Thank you!
The main reason people hold money is that
Question 42 options:
money is intrinsically valuable.
money provides a standard of value.
money is power.
money is used to buy goods and services.
Discretionary fiscal policy is best described as
Question 18 options:
an automatic change in income transfer payments to keep the economy at full employment.
a deliberate attempt to improve the functioning of free markets.
the design of a tax system that automatically stabilizes economic activity over time.
a deliberate attempt to cause the economy to move to full employment and price stability more quickly than it might otherwise.
money is intrinsically valuable.
money provides a standard of value.
money is power.
money is used to buy goods and services.
Discretionary fiscal policy is best described as
Question 18 options:
an automatic change in income transfer payments to keep the economy at full employment.
a deliberate attempt to improve the functioning of free markets.
the design of a tax system that automatically stabilizes economic activity over time.
a deliberate attempt to cause the economy to move to full employment and price stability more quickly than it might otherwise.
Explanation / Answer
Q42
Answer: a). Money is used to buy goods and services.
Explanation: In order to provide for the daily basic needs such as food, bills, clothes, fees people need money. This is called transactionary motive.
In addition to that, people keep the money to keep continuing purchase of goods and services in urgent or in unexpected situations. This is called the precautionary motive.
Thus, The main reason people hold money is that money is used to buy goods and services.
Q18.
Answer is c). the design of a tax system that automatically stabilizes economic activity over time.
Explanation: A discretionary fiscal policy is a government policy that changes taxes with the purpose of stabilising the economy either by expanding or by shrinking it as needed.
This measure is mainly is used to close the deflationary gap by increasing aggregate demand.