Question

The demand for money is positively or directly-related to the level of ___________________ and negatively or inversely-related to the level of ___________________.

	a.	interest rates; income.
	b.	income; interest rates.
	c.	interest rates; wealth.
	d.	unemployment; income.
	e.	unemployment; interest rates.

The opportunity cost of holding money is measured by the:

	a.	unemployment rate.
	b.	interest rate.
	c.	inflation rate.
	d.	liquidity rate.
	e.	graduation rate.

An increase in income, all else constant will:

	a.	not change the demand curve for money.
	b.	cause people to spend less money.
	c.	shift the demand curve for money to the right (increase in demand).
	d.	shift the demand curve for money to the left (decrease in demand).
	e.	b and d.

When there is a decrease in the money supply, which of the following is most likely to happen?

	a.	investment spending will rise.
	b.	government purchases will increase.
	c.	interest rates will rise.
	d.	unemployment rate will fall.
	e.	all of the above.