The quantity of money demanded is the
A)income and volume of profits that people and businesses would like to receive.
B)amount that households and firms choose to hold.
C)average daily volume of bank account withdrawals.
D)sum of cheque and savings deposits at banks.
E)fraction of cash holdings in an average investment portfolio.

Question

Quizplus · Accepted Answer

The quantity of money demanded refers to the amount of money that households and firms choose to hold, which is affected by factors such as interest rates, income, and expectations about future economic conditions. Therefore, choice B is the correct answer as it directly relates to the definition of the quantity of money demanded.

The Quantity of Money Demanded Is the