Between 2006 and 2007, personal income in the U.S. increased from $11 billion to $11.6 billion. As a result, the real demand for money and the demand for money curve .
A) increased; shifted leftward
B) decreased; shifted rightward
C) did not change; did not shift
D) increased; shifted rightward

Question

Quizplus · Accepted Answer

An increase in personal income would lead to an increase in the demand for money, as individuals would have more money available to spend. This would cause the demand for money curve to shift rightward, indicating that at any given interest rate, individuals would be willing to hold a higher quantity of money.

Between 2006 and 2007, Personal Income in the U