Use the Table Below to Answer the Following Questions

question 65

Multiple Choice

Use the table below to answer the following questions.
Table 24.5.1

-Refer to Table 24.5.1. The spreadsheet provides information about the demand for money in Minland. Column A is the nominal interest rate, r. Columns B and C show the quantity of money demanded at two different levels of real GDP: Y₀ is $10 billion and Y₁ is $20 billion.
The quantity of money is $3 billion. Real GDP is $20 billion.
If the interest rate is less than 4 percent a year,

• A)people sell bonds, the price of a bond falls, and the interest rate rises.
• B)people buy bonds, the price of a bond rises, and the interest rate rises.
• C)people sell bonds, the price of a bond falls, and the interest rate falls.
• D)people buy bonds, the price of a bond rises, and the interest rate falls.
• E)the demand for money increases.

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Definitions:

-ic

A suffix indicating pertaining or relating to something, often used in scientific and medical terminology.

Suffix

A morpheme added at the end of a word to form a derivative or alter its meaning.

Combining Form

A prefix or suffix added to a word root to change its meaning or create a new word.

Vowel

A speech sound produced without any significant constriction of the flow of air from the lungs, forming the nucleus of a syllable in languages.