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Higher Interest Rates Lower the Real Quantity of Money Demanded

Question 34

Multiple Choice

Higher interest rates lower the real quantity of money demanded


A) by making alternative nonmonetary assets look relatively more attractive to wealth holders.
B) by causing an increase in the issuance of corporate debt.
C) by changing the distribution of wealth toward the poor who have a lower demand for money.
D) by increasing government interest payments,which in turn increase taxes,lowering disposable income.

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