If the Interest Rate Is Higher Than Normal,people Are More

question 2

Multiple Choice

If the interest rate is higher than normal,people are more likely to hold

• A)bonds instead of money because as the interest rate starts to rise,the value of the bonds will increase.
• B)bonds instead of money because the opportunity cost of money is high.
• C)money instead of bonds because the brokerage fees and other costs of buying bonds are high when the interest rate is low.
• D)money instead of bonds because there is a speculative motive for holding a larger amount of money.

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