Which of the Following Explains Why the Demand for Money

question 63

Multiple Choice

Which of the following explains why the demand for money depends upon the interest rate?  

• A) because money is an interest-earning asset 
• B) because money is NOT an interest-earning asset 
• C) because the alternatives to holding money are NOT interest-earning assets 
• D) because the alternatives to holding money earn more interest than money does

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