As interest rates rise, _____.
(A) It becomes more expensive to hold money as cash.
(B) Bonds and savings accounts become less attractive for investment.
(C) Firms will generally spend their wealth.
(D) It becomes less expensive to hold money as cash.
Ans: (B) Bonds and savings accounts become less attractive for investment.
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Consider an economy where the growth rate of money supply is 2% and the inflation rate is 2%. If the quantity theory of money holds, the growth rate of real GDP in the economy will be:
A) 2%. B) 4%. C) 1%. D) 0%.
In general does international diversification benefit investors?
A) yes, because it allows them to diversify their risk across many countries B) no, because it creates the additional problem of country risk C) yes, because it enables much greater profits through arbitrage opportunities D) no, because it subjects them to legal regulation in additional markets
Which of the following can increase customer interest?
a. Advertising b. Promotional activities c. Service d. All of the above
Which of the following is NOT correct about required reserve ratio?
What will be an ideal response?