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According to Milton Friedman,the Demand for Money Is Insensitive to Interest

Question 65

Multiple Choice

According to Milton Friedman,the demand for money is insensitive to interest rates because


A) the demand for money is insensitive to changes in the opportunity cost of holding money.
B) competition among banks keeps the opportunity cost of holding money relatively constant.
C) people base their investment decisions on expected profits,not interest rates.
D) transactions are not subject to scale economies as wealth increases.

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