Posted: December 12th, 2016

factors shift the real money demand curve to the right

1. Which of the following combination of assets are considered to be money?
currency in circulation, checkable bank deposits, and credit cards
currency in circulation, checkable bank deposits, and travelers checks
currency in circulation and in bank vaults, checkable bank deposits, and travelers checks
currency in circulation and in bank vaults, checkable bank deposits, and credit cards

2. When countries replaced gold and silver coins with paper money exchangeable for certain amounts of precious metals, the monetary system evolved from _______.
using commodity money to using fiat money
using commodity backed money to using fiat money
using commodity money to using commodity backed money
using fiat money to using commodity backed money

3. Banks can lend money because ______.
they have so much to lend
they know not everyone wants their deposits back at the same time
there is a high demand for loans
they know how much cash they have in their vault

4. Banks create money when they ______.
make loans
take deposits
hold excess reserves
pay withdrawals to depositors

5. To change the money supply, the Fed most frequently uses _______.
changes in the required reserve ratios
changes in the discount rate
open market operations
none of the above

6. An increase in the aggregate price _______.
increases the nominal demand for money
decreases the nominal demand for money
does not affect the nominal demand for money
shifts the nominal demand for money to the left

7. The loanable funds model focuses on the ______.
demand for money
supply of funds from lenders
supply of funds from borrowers and the demand by lenders
supply of funds from lenders and the demand from borrowers

8. Expansionary monetary policy _______.
increases the money supply, interest rates, consumption, and investment
decreases the money supply, interest rates, consumption, and investment
increases the money supply, decreases interest rates, and increases consumption and investment
decreases the money supply, increases interest rates, and decreases consumption and investment

9. In the long run, changes in the money supply ______.
affect both the aggregate price level and aggregate output
affect only the price level but they do not change aggregate output
affect aggregate output but not the aggregate price level
have no impact on either the aggregate price level or aggregate output

10. All of the following factors shift the real money demand curve to the right except a(n) _______.
decrease in the number of stores accepting credit cards
increase in the price level
breakdown in information technology that disables ATMs
increase in real aggregate spending