The table below shows the amounts of money that households and businesses want to hold at various interest rates.

$\begin{array} { | c | c | }
\hline \begin{array} { c }
\text { Interest Rate } \
( \% )
\end{array} & \begin{array} { c }
\text { Quantity of money demanded } \
\text { (\$ billions) }
\end{array} \
\hline 10 & 20 \
\hline 8 & 40 \
\hline 6 & 60 \
\hline 4 & 80 \
\hline 2 & 100 \
\hline
\end{array}$
-If the interest rate is 6 percent while the supply of money is $80 billion,there is a:

Question

The table below shows the amounts of money that households and businesses want to hold at various interest rates.

$\begin{array} { | c | c | } 
\hline \begin{array} { c } 
\text { Interest Rate } \
( \% )
\end{array} & \begin{array} { c } 
\text { Quantity of money demanded } \
\text { (\$ billions) }
\end{array} \
\hline 10 & 20 \
\hline 8 & 40 \
\hline 6 & 60 \
\hline 4 & 80 \
\hline 2 & 100 \
\hline
\end{array}$
-If the interest rate is 6 percent while the supply of money is $80 billion,there is a:

Quizplus · Accepted Answer

At an interest rate of 6%, the quantity of money demanded is $60 billion, but the supply is $80 billion, indicating a surplus of money. This surplus will cause the interest rate to fall.

The Table Below Shows the Amounts of Money That Households