If the Quantity of Money Demanded Exceeds the Quantity of Money

question 118

Multiple Choice

If the quantity of money demanded exceeds the quantity of money supplied at a given interest rate,what will happen to restore the market to equilibrium?

• A) The public will try to buy bonds,the price of bonds will increase,and the interest rate will fall until equilibrium is attained where the money demand and supply curves intersect at the market interest rate.
• B) The public will try to sell bonds,the price of bonds will decrease,and the interest rate will rise until equilibrium is attained where the money demand and supply curves intersect at the market interest rate.
• C) The public will try to sell bonds,the price of bonds will increase,and the interest rate will fall until equilibrium is attained where the money demand and supply curves intersect.
• D) The public will try to buy bonds,the price of bonds will increase,and the interest rate will rise until equilibrium is attained where the money demand and supply curves intersect.
• E) The public will try to buy bonds,the price of bonds will decrease,and the interest rate will fall until equilibrium is attained where the money demand and supply curves intersect.

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Definitions:

Strategic Restructuring

The process of reorganizing a company's structure, operations, or portfolio to better align with its strategic goals.

Business Restructuring

A process undertaken by a company to modify its business model or organization in order to improve efficiency, reduce costs, or respond to changing market conditions.

Organizational Restructuring

The process of restructuring a company's legal, ownership, operational, or other aspects to enhance its profitability or to optimize its organization for current requirements.

Workforce Restructuring

The process of reorganizing the workforce to improve efficiency, productivity, or adapt to new business strategies or market demands.