Figure 15-1 -Refer to the Figure 15-1.What Will Happen If the Current

question 116

Multiple Choice

Figure 15-1
-Refer to the Figure 15-1.What will happen if the current interest rate is 2 percent?

• A) There will be excess money supply.
• B) People will sell more bonds,which drives interest rates up.
• C) People will buy more bonds,which drives interest rates up...
• D) People will sell more bonds,which drives the interest rates down.

---

Definitions:

Excess Supply

When the quantity supplied of a good exceeds the quantity demanded.

Excess Demand

When the quantity demanded of a good exceeds the quantity supplied.

Utilities Possibilities Frontier

A graphical representation that shows the maximum amount of two different utilities that can be achieved with a given set of resources.

Unattainable

Refers to goals, objectives, or levels of production that cannot be achieved with the current availability of resources or technology.