When economies speak of the demand for money which of the following are they asking ?
Correct answer: D. What proportion of your financial assets do you want to hold in non-interest-bearing forms
- A. How much cash do you wish you could have?
- B. How much wealth would you like?
- C. How much income would you like to earn?
- D. What proportion of your financial assets do you want to hold in non-interest-bearing forms
Explanation
Demand for money means the share of financial wealth people prefer to keep in liquid, non-interest-bearing forms such as currency and checking deposits. It does not mean wanting more wealth, income, or an unspecified amount of cash.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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