FIGURE 27-2 Refer to Figure 27-2

question 120

Multiple Choice

FIGURE 27-2 Refer to Figure 27-2.If the interest rate is i₂,the subsequent adjustment in the money market is as follows:

• A)Excess demand for money leads to a sale of bonds,which in turn causes the interest rate to rise.
• B)M_S curve will shift to the left as to maintain the interest rate at i₂.
• C)The interest rate will remain at i₂,because the money market is in equilibrium at this interest rate.
• D)Excess supply of money leads to the purchase of bonds,which in turn causes the interest rate to fall to i₀.
• E)Excess supply of money leads to the sale of bonds,which in turn causes the interest rate to fall.

---

Definitions:

Lever Press

A method used in behavioral experiments, typically involving animals like rats or pigeons, where a subject is trained to press a lever to receive a reward or avoid a punishment.

Skinner Box

An experimental apparatus used in the study of animal behavior to investigate the principles of operant conditioning.

Responding Rate

The frequency at which a subject performs a designated response in a given period of time, often measured in behavioral experiments.

Steep Slope

An area of land in which the surface inclines sharply, often presenting challenges in terms of construction, navigation, and stability.