Ask a New Question

If the price level rises, demand of real money increases proporitnally?

TRUE or FALSE

2 answers

True

When there is an increase in the price level, the demand for money increases. Conversely, when there is a decrease in the price level, the demand for money decreases.

Ask a New Question or answer this question.

Similar Questions

If aggregate demand shifts left, then in the short runa. the price level and real GDP both rise. b. the price level falls and
1. 1 answer
If aggregate demand shifts left, then in the short runa. the price level rises and real GDP falls. b. the price and real GDP
1. 1 answer
At an initial point on the aggregate demand curve, the price level is 100, and real to GDP is $15trillion. After the price level
1. 0 answers
3. Suppose that the money demand function is(𝑀/𝑃)𝑑 = 1,000 − 100𝑟, where r is the interest rate in percent. The
1. 1 answer

more similar questions