When the money market is drawn with the value of money on the vertical axis, if there is a surplus of money then
A)the value of money rises which will make people desire to hold more money.
B)the value of money rises which will make people desire to hold less money.
C)the value of money falls which will make people desire to hold more money.
D)the value of money falls which will make people desire to hold less money.

Question

Quizplus · Accepted Answer

When there is a surplus of money, the value of money falls, leading people to desire to hold more money as it becomes cheaper to hold.

When the Money Market Is Drawn with the Value of Money