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Terms in this set (68)For any given level of output, the interest rate adjusts to balance the supply of, and demand for, money. According to classical macroeconomics theory, output is determined by the supplies of capital and labor and the available production. Moreover, for any given level of output, the interest rate adjusts to balance the supply of, and demand for, loanable funds. Then, given output and the interest rate, the price level adjusts to balance the supply of, and demand for, money. Students also viewedSets found in the same folderOther sets by this creatorVerified questions
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Other Quizlet setsWhich of the following will cause the money demand curve to shift to the right?Answer and Explanation: When there is an increase in the price level, it means that people will require more money to purchase the same level of goods and services. As a result, the demand for money will increase, and this will shift the money demand curve to the right.
Which of the following would cause the money demand curve to shift to the right quizlet?An increase in the interest rate shifts the money demand curve to the right.
What causes a shift of the money demand curve?Among the most important variables that can shift the demand for money are the level of income and real GDP, the price level, expectations, transfer costs, and preferences.
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Which of the following will cause money demand curve to shift to the right in the money market quizlet?
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