Refer to the diagram below for the market for money.Other things equal, the money demand curve in the diagram would shift leftward if:

Question

Quizplus · Accepted Answer

If nominal GDP decreases, this means there is a decrease in the demand for goods and services in the economy. Therefore, individuals and firms would need less money to make transactions, leading to a decrease in the transactions demand for money and a leftward shift of the money demand curve.

Refer to the Diagram Below for the Market for Money