The ________ the nominal interest rate,the ________ is the quantity of money demanded.
A)higher;greater
B)lower;greater
C)lower;smaller
D)more variable;smaller
E)None of the above because the nominal interest rate does not influence the quantity of money demanded.

Question

Quizplus · Accepted Answer

The quantity of money demanded is inversely related to the nominal interest rate. When the nominal interest rate is lower, the opportunity cost of holding money decreases, leading to a greater quantity of money demanded.

The ________ the Nominal Interest Rate,the ________ Is the Quantity

The the Nominal Interest Rate,the Is the Quantity