Which of the following shifts in the demand for money or the supply of money is most likely to occur as the result of a recession?
A)The demand curve shifts leftward.
B)The demand curve shifts rightward.
C)The supply curve shifts rightward.
D)Both the demand and supply curves shift rightward.

Question

Quizplus · Accepted Answer

During a recession, people tend to hold onto their money more tightly and are more cautious with spending, resulting in a decrease in the demand for money. This causes the demand curve to shift leftward.

Which of the Following Shifts in the Demand for Money