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When the Nominal Interest Rate Falls, the Opportunity Cost of Holding

Question 1

Multiple Choice

When the nominal interest rate falls, the opportunity cost of holding money


A) decreases and the demand for money curve shifts leftward.
B) decreases and there is a movement downward along the demand for money curve.
C) increases and there is a movement upward along the demand for money curve.
D) decreases and the demand for money curve shifts rightward.
E) increases and the demand for money curve shifts rightward.

Correct Answer:

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