MONEY DEMAND & INTEREST RATE SECTION A (TRUE/FALSE/MULTIPLE-CHOICE QUESTIONS) 1. The functions of money are to serve as a measure of value, store of value and medium of exchange. T/F 2. Money functions as a store of value if it allows you to measure the value of goods in a reliable way. T/F 3. The M1 definition of the money supply includes coins and currency in circulation, checkable deposits, and traveler's checks. T/F 4. A checkable deposit at a commercial bank is a liability to the depositor and asset to the bank. T/F 5. The major purpose of a central bank buying government securities in open-market operations is to allow banks to increase their lending T/F 6. Lowering the discount rate has the effect of making it more expensive for commercial banks to borrow from the central banks. T/F 7. An increase in the money supply usually decreases the interest rate and increases aggregate demand. T/F 8. Tight monetary policy tends to decrease the interest rate and increase aggregate demand. T/F 9. If the central bank of Malaysia officials attempts to pull out of a recession when the price level is relatively stable, the policies they would most likely use would be to buy government securities and increase the discount rate. T/F Please explain why is it true and why false :) thank you so much