Q14 of 25 Page 1

Define money supply.

Money supply is the total stock of money in the economy at a particular point in time. It is a stock variable and is measured at a particular point in time. It is the total quantity of money in the economy at any particular point in time. It includes the total currency and coins with the public and demand deposits with commercial banks.


More from this chapter

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12

State three characteristics of monopolistic competition. Which of the characteristics separates it from perfect competition and why?

OR


Explain the implications of the following:


a. Freedom of entry and exit under perfect competition.


b. Non-price competition in oligopoly.

 13

Which of the following affects national income? (Choose the correct alternative)

(a) Goods and Services tax


(b) Corporation tax


(c) Subsidies


(d) None of the above

 15

The central bank can increase the availability of credit by (Choose the correct alternative)

(a) Raising repo rate


(b) Raising reverse repo rate


(c) Buying government securities


(d) Selling government securities

 16

Why does the consumption curve not start from the origin?