The authors propose a pedagogical apparatus embodying a solid microfoundation with emphasis on the public's choice between currency and demand deposits being an optimal decision. On the basis of the pedagogical exposition, the authors explain how money supply is related to the combined behaviors...

The authors propose a pedagogical apparatus embodying a solid microfoundation with emphasis on the public’s choice between currency and demand deposits being an optimal decision. On the basis of the pedagogical exposition, the authors explain how money supply is related to the combined...