Determinants of Supply And Demand For Money - SS2 Economics Past Questions and Answers - page 1
What factors influence the demand for money?
Interest rates, level of income, and price level
Monetary policy, banking system, and government spending
Supply and demand, market equilibrium, and consumer preferences
None of the above
What factors influence the supply of money?
Interest rates, level of income, and price level
Monetary policy, banking system, and government spending
Supply and demand, market equilibrium, and consumer preferences
None of the above
How can central banks control the supply of money?
By adjusting interest rates
By printing more money
By creating loans and deposits
a and b
(Central banks can control the supply of money through monetary policy, such as adjusting interest rates or printing more money)
How does an increase in the general price level affect the demand for money?
People tend to hold less money
People tend to hold more money
It has no effect on the demand for money
None of the above
(As the general price level in the economy increases, people tend to hold more money because they need more to pay for goods and services)
What is the difference between supply and demand for money?
The demand for money is the amount of money people want to hold, while the supply of money is the amount of money available in the economy.
What is the role of the banking system in determining the supply of money?
The banking system can influence the supply of money by creating loans and deposits, which increases the money supply.