Use the following figure to answer the question :

-In the figure above,the decrease in the interest rate from i1 to i2 can be explained by
A)a decrease in money growth.
B)an increase in money growth.
C)a decline in the expected price level.
D)an increase in income.

Question

Use the following figure to answer the question :

-In the figure above,the decrease in the interest rate from i1 to i2 can be explained by
A)a decrease in money growth. 
B)an increase in money growth. 
C)a decline in the expected price level. 
D)an increase in income.

Quizplus · Accepted Answer

An increase in money growth typically leads to a higher supply of money, which can result in lower interest rates as there is more money available for borrowing.

Use the Following Figure to Answer the Question