Exhibit: Market for Real Money Balances 
Based on the graph, if the interest rate is r3, then people will _____ bonds, and the interest rate will _____.
Definitions:
Net Present Value
The distinction in present monetary value between incoming and outgoing cash over a designated interval.
Investment Opportunities
Potential prospects or ventures that could yield financial returns or profits for investors.
Cash Savings
Funds that are kept on hand or in a bank account and are readily available for use in emergencies or for future purchases.
Simple Rate of Return
The percentage of annual incremental net operating income to the initial investment cost.
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