There is a positive relationship between interest rates and the money supply.

Name: There is a positive relationship between interest rates and the money supply.
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Question

Quizplus · Accepted Answer

This statement is false. Generally, there is an inverse relationship between interest rates and the money supply. When interest rates are high, people tend to save more and borrow less, which decreases the money supply. When interest rates are low, people tend to save less and borrow more, which increases the money supply.

There Is a Positive Relationship Between Interest Rates and the Money