If the government implements a restrictive fiscal policy, then
A) the income velocity of money should increase
B) the income velocity of money should decrease
C) the income velocity of money should remain unaffected
D) money demand should increase since people have to pay more taxes
E) money demand and the income velocity of money should both decrease
Correct Answer:
Verified
Q18: Which of the following affected the demand
Q19: According to the Baumol-Tobin transaction demand model,
Q20: A disadvantage of holding money rather than
Q21: In which of the following cases would
Q22: If the income elasticity of demand for
Q24: If restrictive fiscal policy is combined with
Q25: If the income elasticity of money demand
Q26: The speculative demand for money
A)can clearly be
Q27: If real GDP increased by 3% over
Q28: The demand for money for precautionary reasons
A)increases
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