Exhibit 15.1 -Exhibit 15.1 shows the interest rate on the vertical axis and the quantity of money on the horizontal axis. An increase in the interest rate will cause a movement from _____ A) point B to point A. B) point A to point B. C) D_M to D_M'. D) D_M to D_M*. E) point E to point D.

Question

Quizplus · Accepted Answer

According to the exhibit, an increase in interest rates will cause a movement along the money demand curve (DS1U1B1) from point B to point A, as the quantity of money demanded decreases when the interest rate increases.

Exhibit 15.1 -Exhibit 15.1 Shows the Interest Rate on the Vertical Axis