Figure 21-1
-Refer to Figure 21-1. Which of the following is correct?
A)If the interest rate is 4 percent, there is excess money demand, and the interest rate will fall.
B)If the interest rate is 3 percent, there is excess money supply, and the interest rate will rise.
C)Starting with an interest rate of 4 percent, the demand for goods and services will increase until the money market reaches a new equilibrium.
D)None of the above is correct.

Question

Figure 21-1 
-Refer to Figure 21-1. Which of the following is correct?
A)If the interest rate is 4 percent, there is excess money demand, and the interest rate will fall. 
B)If the interest rate is 3 percent, there is excess money supply, and the interest rate will rise. 
C)Starting with an interest rate of 4 percent, the demand for goods and services will increase until the money market reaches a new equilibrium. 
D)None of the above is correct.

Quizplus · Accepted Answer

The Answer of Figure 21-1 
-Refer to Figure 21-1. Which of the following is correct?
A)If the interest rate is 4 percent, there is excess money demand, and the interest rate will fall. 
B)If the interest rate is 3 percent, there is excess money supply, and the interest rate will rise. 
C)Starting with an interest rate of 4 percent, the demand for goods and services will increase until the money market reaches a new equilibrium. 
D)None of the above is correct.

Figure 21-1 -Refer to Figure 21-1. Which of the Following Is Correct