Choose the correct answer of the following 1. Which of the following would refle
ID: 1211257 • Letter: C
Question
Choose the correct answer of the following
1. Which of the following would reflect the transactions demand for money?
a.Keeping money under your mattress in case of emergency.
b. Keeping money in your wallet to pay the subway fare.
c. Keeping money in a savings account at the bank.
d. Keeping money in your child's piggy bank.
2.The productivity will be better if
a. There is developed capital.
b. There are knowledge and skills that workers acquire through education, training, and experience.
c. There is society’s understanding of the best ways to produce goods and services.
d. All of the above.
3.According to the quantity theory, money in the long run affects:
a. The velocity of money.
b. Prices.
c. Real GDP.
d. None of the above.
4.When there is inflation
a. Prices decrease in the economy.
b. The value of the dollar rises on foreign exchange markets.
c. Basic necessities become cheaper.
d. The value of money decreases in the economy.
5.Money Demand is the:
a. Amounts of money people are willing to hold at different price levels.
b. Amounts of money people are willing to buy at different price levels.
c. Amounts of dollars foreigners are willing to buy with their foreign currency.
d. Amounts of dollars U.S. citizens are willing to buy with their holdings of foreign currency
Explanation / Answer
Transaction demand for implies the requirement of money for day to days needs. Thus correct answer is (B) Productivity means more output with same input or same output with lesser inputs . thus, Correct answer is (D) Money in long run affects only Prices. Correct answer is (B) When there is inflation Value of money decreases in economy. Right answer is (d) Correct answer is (a).