Money Demand and Interest Rates: Economics of Demand


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question 1 of 3

When looking at the demand curve for money, which of the following completes this sentence?

When interest rates are 20%, the demand for money is _____.

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1. As the price level decreases, how is the value of money impacted?

2. How does the demand curve for money shift?

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About This Quiz & Worksheet

This quiz and worksheet combo can help you gauge your knowledge of money demand and its influences. Topics you will be quizzed on include interest rates and wealth.

Quiz & Worksheet Goals

This quiz/worksheet combo can help you review:

  • The demand for money
  • Relationship between interest rates and the demand for money
  • Characteristics of money demand
  • Value of money

Skills Practiced

This quiz and worksheet combo can help you practice the following skills:

  • Interpreting information - verify that you can read information regarding the demand for money and interpret it correctly
  • Defining key concepts - ensure that you can accurately define main phrases, such as the value of money and the demand for money
  • Information recall - access the knowledge you have gained regarding interest rates

Additional Learning

You should also review the corresponding lesson called Money Demand and Interest Rates: Economics of Demand. This lesson will help you:

  • Distinguish between money, income and wealth
  • Define money demand
  • Find the relationship between the demand for money and interest rates
  • Review the money demand curve