A Decrease in the Rate of Interest Would

question 126

Multiple Choice

A decrease in the rate of interest would:

• A)decrease the opportunity cost of holding money.
• B)increase the transactions demand for money.
• C)increase the asset demand for money.
• D)decrease the price of bonds.

---

Definitions:

Increasing the Dividend

The action by a company to raise the amount of money paid to shareholders out of its profits on a per-share basis.

Rate of Return

The rate at which an investment gains (or loses) value over a specified period, expressed as a percentage.

Growth Rate

A percentage figure indicating the rate at which a company's revenue or earnings are increasing over a specific period, typically used as a measure of a company’s financial health or performance.

Investor's Return

The profit or loss made on an investment, usually expressed as a percentage of the initial investment.