A Decrease in the Interest Rate, Other Things Being Equal

question 9

Multiple Choice

A decrease in the interest rate, other things being equal, causes

• A) an upward movement along the demand curve for money.
• B) a downward movement along the demand curve for money.
• C) a rightward shift of the demand curve for money.
• D) a leftward shift of the demand curve for money.

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Definitions:

Composition

In mathematics, the operation of applying one function to the results of another, denoted as \((f \circ g)(x) = f(g(x))\).

Function

A relationship or expression involving one or more variables.

Logarithm

A mathematical operation that determines the power to which a base must be raised to produce a given number.

Graph

A diagram showing the relation between variable quantities, typically of two variables, each measured along one of a pair of axes at right angles.