As the number of transactions in the economy decreases:

Question

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The demand for money is the amount of money people want to hold for transactions and precautionary purposes. If the number of transactions in the economy decreases, people will need less money to conduct those transactions, leading to a decrease in the demand for money. The supply of money, on the other hand, is determined by the central bank and can increase or decrease for other reasons unrelated to the number of transactions.

As the Number of Transactions in the Economy Decreases