If the Interest Rate Falls,the Opportunity Cost of Holding Money

question 11

Multiple Choice

If the interest rate falls,the opportunity cost of holding money __________ and the quantity demanded of money __________.

• A) rises,rises
• B) rises,falls
• C) falls,rises
• D) falls,falls

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Definitions:

Countertrade

A method of trade in which goods or services are exchanged directly for other goods or services without the use of money.

Foreign Exchange

The exchange of one currency for another or the conversion of one currency into another currency.

Labor-intensive Exports

Refers to goods or products that require a significant amount of manual labor to produce, which are then sold to other countries.

Leading Exporter

A country or company that is one of the foremost suppliers of goods or services to markets outside its own borders.