Question

5. A consumer holds money to meet spending needs. This would be an example of the:  ...

5. A consumer holds money to meet spending needs. This would be an example of the:  

A. Use of money as a measure of value

B. Use of money as legal tender

C. Liquidity demand, also known as transactions demand for money

D. Asset demand for money

6. The fundamental objective of monetary policy is to assist the economy in achieving:

A. A rapid pace of economic growth

B. A money supply which is based on the gold standard

C. A full-employment, noninflationary level of total output

D. A balanced-budget consistent with full-employment

7. The purchase and sale of government securities by the Fed is called:

A. Federal funds market

B. Open market operations

C. Money market transactions

D. Term auction facility

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Answer #1

5. A consumer holds money to meet spending needs. This would be an example of the

C. Liquidity demand, also known as transactions demand for money

So, option C is correct.

6) The fundamental objective of monetary policy is to assist the economy in achieving:

A full employment, non inflationary level of total output.

So, correct option is C.

7) The purchase and sale of government securities by the Fed is called:

Open market operations

So, option B is correct.

If you have any doubts please comment...

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