Refer to the information provided in Figure 11.7 below to answer the questions that follow.
Figure 11.7
-Refer to Figure 11.7.If the demand for money curve shifts from to and the interest rate remains at 5%,there will be

Question

Refer to the information provided in Figure 11.7 below to answer the questions that follow.

Figure 11.7
-Refer to Figure 11.7.If the demand for money curve shifts from to and the interest rate remains at 5%,there will be Refer to the information provided in Figure 11.7 below to answer the questions that follow. Figure 11.7 -Refer to Figure 11.7.If the demand for money curve shifts from <sub> </sub>to and the interest rate remains at 5%,there will be A) an excess demand for money. B) an excess supply of money. C) an equilibrium in the money market. D) an equilibrium in the bond market.

Quizplus · Accepted Answer

When the demand for money curve shifts to the left (from _to), it means that at the same interest rate, people demand less money. This leads to an excess supply of money in the market. Therefore, if the interest rate remains at 5%, there will be an excess supply of money, leading to an excess demand for goods and services, and causing the interest rate to fall until a new equilibrium is reached.

Refer to the Information Provided in Figure 11