An Increase in Interest Rates Causes the Demand for Money

question 29

Multiple Choice

An increase in interest rates causes the demand for money to:

• A) increase.
• B) decrease.
• C) stay the same.
• D) shift to the right.

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Definitions:

Behavior

The responses or behaviors of an individual, whether human or animal, triggered by outside or inside factors.

Punishment

The imposition of a penalty or unpleasant consequence in response to an undesirable behavior, aimed at reducing or eliminating that behavior.

Extinction

In behavioral psychology, the gradual weakening and eventual disappearance of a conditioned response.

Desirable Behaviors

Actions or conduct considered appealing or appropriate by a group, culture, or society, often encouraged or rewarded.