The Interest-Rate Effect

question 213

Multiple Choice

The interest-rate effect

• A)depends on the idea that increases in interest rates decrease the quantity of goods and services demanded.
• B)depends on the idea that increases in interest rates decrease the quantity of goods and services supplied.
• C)is responsible for the downward slope of the money-demand curve.
• D)is the least important reason, in the case of the United States, for the downward slope of the aggregate-demand curve.

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