What Are the Effects of an Increase in the Price

question 249

Multiple Choice

What are the effects of an increase in the price level?

• A) People hold less money, so they lend less, and the interest rate rises.
• B) People hold less money, so they lend more, and the interest rate falls.
• C) People hold more money, so they lend more, and the interest rate falls.
• D) People hold more money, so they lend less, and the interest rate rises.

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