1|Page
ECON 200 UOFA Exam 2 Newest 2026/2027 Complete 150
Questions And Correct Answers (Verified Answers) |Already
Graded A+||Just Out!!!
If credit cards were suddenly ruled illegal and were no longer
used, the most likely effect would be a decrease in the
a. demand for money.
b. level of cash balances.
c. average checking account balance.
d. velocity of circulation. - ANSWER-d. velocity of circulation.
The efficiency of the payments' mechanism affects
a. the speed with which money can be exchanged for other
assets.
b. how quickly individual loan applications will be approved.
c. how slowly individuals deplete their cash balances.
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d. the speed with which financial institutions can process
checks and other funds. - ANSWER-d. the speed with which
financial institutions can process checks and other funds.
In 1998, the Fed cut interest rates to prevent the spread of the
international financial crisis. What is the effect of this on
velocity?
a. It will decrease.
b. It will increase.
c. It will remain constant.
d. Velocity is unrelated to interest rates. - ANSWER-a. It will
decrease.
As we approached the end of the millennium, many economic
crackpots advised citizens to hold large quantities of cash in
anticipation of Y2K disasters. What effect would this have had
on velocity if many people had been foolish enough to follow
this advice?
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a. It would have decreased.
b. It would have increased.
c. It would have remained constant.
d. Velocity is unrelated to cash balances. - ANSWER-a. It would
have decreased.
Many banks offer accounts featuring "Automatic Transfer from
Savings" allowing customers to overdraw checking accounts and
the bank will transfer enough funds to cover the check
automatically. Most likely, what is the effect of this feature on
velocity?
a. It will decrease.
b. It will increase.
c. It will remain constant.
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d. Velocity is unrelated to saving accounts. - ANSWER-b. It will
increase.
Monetarists maintain that
a. the best way to study the economy is with the expenditure
schedule.
b. control over the money supply implies control over real GDP.
c. velocity is not constant, but is fairly predictable.
d All of the above are correct. - ANSWER-c. velocity is not
constant, but is fairly predictable.
The major limitation of both the Keynesian approach and the
monetarist approach is that both
a. focus on the determination of interest rates to the exclusion
of price levels.
ECON 200 UOFA Exam 2 Newest 2026/2027 Complete 150
Questions And Correct Answers (Verified Answers) |Already
Graded A+||Just Out!!!
If credit cards were suddenly ruled illegal and were no longer
used, the most likely effect would be a decrease in the
a. demand for money.
b. level of cash balances.
c. average checking account balance.
d. velocity of circulation. - ANSWER-d. velocity of circulation.
The efficiency of the payments' mechanism affects
a. the speed with which money can be exchanged for other
assets.
b. how quickly individual loan applications will be approved.
c. how slowly individuals deplete their cash balances.
,2|Page
d. the speed with which financial institutions can process
checks and other funds. - ANSWER-d. the speed with which
financial institutions can process checks and other funds.
In 1998, the Fed cut interest rates to prevent the spread of the
international financial crisis. What is the effect of this on
velocity?
a. It will decrease.
b. It will increase.
c. It will remain constant.
d. Velocity is unrelated to interest rates. - ANSWER-a. It will
decrease.
As we approached the end of the millennium, many economic
crackpots advised citizens to hold large quantities of cash in
anticipation of Y2K disasters. What effect would this have had
on velocity if many people had been foolish enough to follow
this advice?
,3|Page
a. It would have decreased.
b. It would have increased.
c. It would have remained constant.
d. Velocity is unrelated to cash balances. - ANSWER-a. It would
have decreased.
Many banks offer accounts featuring "Automatic Transfer from
Savings" allowing customers to overdraw checking accounts and
the bank will transfer enough funds to cover the check
automatically. Most likely, what is the effect of this feature on
velocity?
a. It will decrease.
b. It will increase.
c. It will remain constant.
, 4|Page
d. Velocity is unrelated to saving accounts. - ANSWER-b. It will
increase.
Monetarists maintain that
a. the best way to study the economy is with the expenditure
schedule.
b. control over the money supply implies control over real GDP.
c. velocity is not constant, but is fairly predictable.
d All of the above are correct. - ANSWER-c. velocity is not
constant, but is fairly predictable.
The major limitation of both the Keynesian approach and the
monetarist approach is that both
a. focus on the determination of interest rates to the exclusion
of price levels.
