The supply of money increases when the interest rate rises.

Name: The supply of money increases when the interest rate rises.
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Question

Quizplus · Accepted Answer

The supply of money is not directly linked to the interest rate. Rather, the supply of money is determined by the monetary policy of the central bank. An increase in the interest rate may affect the demand for money, but it does not directly affect the supply of money.

The Supply of Money Increases When the Interest Rate Rises