Fisher's quantity theory of money suggests that the demand for money is purely a function of ________,and ________ no effect on the demand for money.
A)income;interest rates have
B)interest rates;income has
C)government spending;interest rates have
D)expectations;income has

Question

Quizplus · Accepted Answer

Fisher's quantity theory of money posits that the demand for money is primarily driven by income levels, and interest rates do not affect the demand for money. This theory focuses on the transactional need for money, which increases with income, rather than speculative or precautionary motives that might be influenced by interest rates.

Fisher's Quantity Theory of Money Suggests That the Demand for Money