Business, 18.12.2019 04:31 duncanje5783

The opportunity cost of holding money suppose you've just inherited $10,000 from a relative. you're trying to decide whether to put the $10,000 in a non-interest-bearing account so that you can use it whenever you want (that is, hold it as money) or to use it to buy a u. s. treasury bond. the opportunity cost of holding the inheritance as money depends on the interest rate on the bond. what does the previous analysis suggest about the market for money? a) the quantity of money demanded increases as the interest rate rises. b) the supply of money is independent of the interest rate. c) the quantity of money demanded decreases as the interest rate rises.

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