Choice Questions - Choice Questions 1. "The price for a ticket to ...

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AP Macro Unit 4 Financial Sector Multiple Choice Questions

• "The price for a ticket to the Super Bowl is $500." This statement best illustrates money used as a
• Illiquid asset
• Liquid asset
• Unit of account
• Medium of exchange
• Store of value

• If you use money as a store of value, you would be
• Buying a new watch
• Searching the Internet for a deal on a new car
• Putting money into a savings account
• Lending money to friend
• Paying for gas on your credit card

• Which of the following is NOT part of M1?
• Savings deposits
• Checkable deposits
• Coins
• Travelers checks
• Currency

• Which of the following will most likely occur in an economy if more money is demanded than is supplied?
• The amount of investment spending will increase.
• Interest rates will increase
• The supply of money will decrease
• Deflation
• The aggregate demand will increase

• Which if the following is true for the money market graph?
• The demand for money is vertical because of autonomous spending
• The supply of money is downward sloping
• There is no relationship between the nominal interest rate and the quantity of money demanded in the long-

run

• There is an inverse relationship between the nominal interest rate and the quantity of money demanded
• An increase in the nominal interest rate will shift the money supply to the right

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