If there is an excess quantity of money, people will buy bonds.

Question

Quizplus · Accepted Answer

When there is an excess quantity of money in the economy, interest rates tend to decrease as money supply exceeds demand. Lower interest rates make bonds, which pay fixed interest, less attractive compared to other investments. However, investors and people holding excess cash may still buy bonds as a safer investment option compared to stocks or other volatile assets, especially if they anticipate future interest rate increases that would raise bond prices.

If There Is an Excess Quantity of Money, People Will