Chapter_4

Chapter_4 - Macroeconomics Test Yourself Chapter4 1. Which...

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Macroeconomics Test Yourself Chapter4 1. Which of the following is a characteristic of "bonds"? a. pay zero interest. b. can be used for transactions. c. are sold for a price that varies inversely with the interest rate. d. all of the above. e. none of the above. 2. The demand for money a. varies inversely with the interest rate. b. varies inversely with income. c. is equal to the demand for bonds. d. has the same absolute value, but opposite sign, as the demand for bonds. e. is infinite -- people always want more money. 3. Which of the following would shift the demand for money curve leftward ? a. a drop in income. b. a rise in the interest rate. c. an increase in the money supply. d. all of the above. e. none of the above. 4. Which of the following would cause a rightward shift in money demand? a. a reduction in the interest rate b. an increase in the interest rate c. an open market sale of bonds by the central bank d. an open market purchase of bonds by the central bank e. an increase in income 5. Which of the following are a component of M1? a. bonds. b. checkable deposits. c. money market funds. d. all of the above. e. none of the above. 6. Velocity is: a. the ratio of nominal income to money. b. the ratio of money to nominal income. c. the ratio of money to bonds.
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Chapter_4 - Macroeconomics Test Yourself Chapter4 1. Which...

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