Which of the following statements is accurate?
A) The derived demand for the money base depends negatively on the interest rate; it is strong when checking accounts earn market rates and weak when they earn only small returns.
B) The derived demand for the money base depends negatively and proportionately on the price level because currency and checking deposit demand are both correlated with nominal GDP.
C) The derived demand for the money base depends negatively and proportionately on real GDP because currency and checking deposit demand are both correlated with nominal GDP.
D) All of the above.
E) None of the above.

Question

Quizplus · Accepted Answer

The Answer of Which of the following statements is accurate?
A) The derived demand for the money base depends negatively on the interest rate; it is strong when checking accounts earn market rates and weak when they earn only small returns.
B) The derived demand for the money base depends negatively and proportionately on the price level because currency and checking deposit demand are both correlated with nominal GDP.
C) The derived demand for the money base depends negatively and proportionately on real GDP because currency and checking deposit demand are both correlated with nominal GDP.
D) All of the above.
E) None of the above.

Which of the Following Statements Is Accurate