Why Is the Asset Demand for Money Curve Downward-Sloping

question 119

Multiple Choice

Why is the asset demand for money curve downward-sloping?

• A)As the interest rate increases,the opportunity cost of holding money also increases.
• B)As the interest rate increases,the opportunity cost of holding money decreases.
• C)As the interest rate increases,so too do bond prices.
• D)It becomes more attractive to hold money as the interest rate increases.
• E)As people hold larger quantities of money,the interest rate is forced down.

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