When the money market is depicted in a graph with the value of money on the vertical axis, as the price level increases, which of the following happens to the value of money?
A)It increases, so the quantity of money demanded increases.
B)It increases, so the quantity of money demanded decreases.
C)It decreases, so the quantity of money demanded decreases.
D)It decreases, so the quantity of money demanded increases.

Question

Quizplus · Accepted Answer

As the price level increases, the value of money decreases, leading to an increase in the quantity of money demanded.

When the Money Market Is Depicted in a Graph with the Value