A. the money and labor markets
B. the goods and labor markets
C. the goods market
D. the money markets
Related Mcqs:
- Keynes liquidity preference theory of the interest rate suggests that the interest rate is determined by ?
A. aggregate supply and aggregate demand
B. the supply and demand for loanable funds
C. the supply and demand for money
D. the supply and demand for labor - For the United States suppose the annual interest rate on government securities equals 8 percent while the annual inflation rate equals 4 percent, For Switzerland the annual interest rate on government securities equal 10 percent while the annual inflation rate equals 7 percent the above variables would cause investment funds to flow from ?
A. the United States to Switzerland causing the dollar to depreciate
B. the United States to Switzerland causing the dollar to appreciate
C. Switzerland to the United States causing the franc to depreciate
D. Switzerland to the United States causing the franc to appreciate - For the United States suppose the annual interest rate on government securities equals 12 percent while the annual inflation rate equals 8 percent For Japan the annual interest rate on government securities equals 10 percent while the annual inflation rate equals 5 percent the above variables would cause investment funds to flow from ?
A. The United States to Japan causing the dollar to depreciate
B. The United States to Japan causing the dollar to appreciate
C. The Japan to United States, causing the dollar to depreciate
D. The Japan to United States, causing the dollar to appreciate - If the nominal interest rate is 7 percent and the inflation rate is 3 percent, then the real interest rate is ?
A. 4 percent
B. 10 percent
C. -4 percent
D. 3 percent
E. 21 percent - When money demand is expressed in a graph with the interest rate on the vertical axis and the quantity of money on the horizontal axis an increase in the interest rate ?
A. None of these answers
B. decrease the quantity demanded of money
C. increase the quantity demanded of money
D. decreases the demand for money
E. increases the demand for money - If inflation is 8 percent and the real interest rate is 3 percent, then the nominal interest rate must be ?
A. 3/8 percent
B. 5 percent
C. 11 percent
D. 24 percent - The normal rate of profit for relatively risk-free firms will be _________ the interest rate on risk-free government bonds?
A. approximately one-half
B. smaller than
C. larger than
D. approximately equal to - The motive for holding money that encourages investors to hold bonds when interest rates are low, with the hope of selling them when interest rates are high, is the ?
A. Transactions motive
B. precautionary motive
C. profit motive
D. speculation motive - The equilibrium inflation rate is determined by the intersection of _____ and _____?
A. demand, supply
B. IS, LM
C. AD, AS
D. Labor demand, labor supply - What is called interest that is paid previously earned interest as well as on the principal ?
A. Gross interest
B. Simple interest
C. Total interest
D. Compound interest
