According to Liquidity Preference Theory,the Opportunity Cost of Holding Money

question 46

Multiple Choice

According to liquidity preference theory,the opportunity cost of holding money is

• A)the interest rate on bonds.
• B)the inflation rate.
• C)the cost of converting bonds to a medium of exchange.
• D)the difference between the inflation rate and the interest rate on bonds.

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Definitions:

Upwelling

The oceanographic phenomenon that occurs when deep, cold, nutrient-rich water rises towards the surface, promoting the growth of plankton and supporting marine ecosystems.

Phytoplankton

Microscopic plant-like organisms that float in water bodies; they are the primary producers in aquatic ecosystems.

Radioactive Isotope

An isotope of an element that has an unstable nucleus and emits radiation during its decay to a stable form.