When money-demand shifts are the predominant disturbance
A) the interest rate depends on the position of the IS curve.
B) the interest rate will be more volatile with an interest-rate target than with a money-supply target.
C) the interest rate will be more volatile with a GDP target than with a money-supply target.
D) a rigid money-supply target will allow the interest rate to respond to shifts in demand for money.
Correct Answer:
Verified
Q104: The Baumol model of money demand strengthens
Q105: Given the quantity theory of money 1/V
Q106: Which of the following is NOT included
Q107: Economist James Tobin developed a formal model
Q108: Economist Milton Friedman's theory of money demand
Q110: If velocity were constant,as assumed by the
Q111: Suppose that a bond-financed deficit shifts the
Q112: The major reason tight money fell so
Q113: An important distinction between Friedman's and others'
Q114: When demand for money is unstable,
A)a constant
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents