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8 Cards in this Set

  • Front
  • Back
Transactions demand for money
the stock of money people hold to pay everyday predictable expenses
Precautionary demand for money
The stock of money people hold to pay unpredictable expenses
Speculative demand for money
The stock of money people hold to take advantage of expected future changes in the price of bonds, stocks, or other nonmoney financial assets
Demand for money curve
a cureve representing the quantity of money people hold at different possible interest rates, cetris paribus
Monetarism
The theory that changes in the money supply directly deteremine changes in price, real GDp, and employment
Equation of exchange
An accounting identity stating that the money supply times the velocity of money equals total spending
Velocity of money
The average number of times per year a dollar of the money supply is spent of final goods and services
Quantity theory of money
THe theory that changes in the money supply are directly related to changes in the price level