If the Reserve Bank wants to raise the interest rate,it
A)shifts the demand for money curve rightward.
B)decreases the quantity of money.
C)increases the quantity of money.
D)directly raises the interest rate and does nothing to either the supply of money or the demand for money.
E)shifts the demand for money curve leftward.

Question

Quizplus · Accepted Answer

To raise interest rates, the Reserve Bank typically decreases the quantity of money in the economy, which reduces the supply of money, leading to higher interest rates.

If the Reserve Bank Wants to Raise the Interest Rate,it