Monetary Policy 2

  1. is money held to pay for everyday predictable expenses.
    Transactions demand for money
  2. is money held to pay unpredictable expenses
    Precautionary demand for money
  3. is money held to take advantage of price changes in nonmoney assets
    Speculative demand for money
  4. shows the quantity of money people hold at various rates of interest
    Demand for money curve
  5. is the view that changes in monetary policy directly change aggregate demand, and thereby prices, real GDP, and employment
  6. is an accounting identity which is the foundation of monetarism. The equation (MV = PQ) states that the money supply times the velocity of money is equal to the price level times real output.
    Equation of exchange
  7. is the number of times each dollar is spent.
    Velocity of money
Card Set
Monetary Policy 2
Monetary Policy