Figure 26-2 -Refer to Figure 26-2.In the figure above,when the money supply shifts from MS₁ to MS₂,at the interest rate of 3 percent households and firms will A) buy Treasury bills. B) sell Treasury bills. C) neither buy nor sell Treasury bills. D) want to hold less money.

Question

Quizplus · Accepted Answer

When the money supply increases from MS1 to MS2, the interest rate falls below 3 percent, making existing Treasury bills with higher rates more attractive to sell.

Figure 26-2 -Refer to Figure 26-2.In the Figure Above,when the Money Supply