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If the Interest Rate Is Above the Equilibrium Rate, How

Question 91

Multiple Choice

If the interest rate is above the equilibrium rate, how is equilibrium achieved in the money market?


A) People buy goods to get rid of their excess money, lowering the price of goods and lowering the interest rate.
B) People sell goods to get rid of their excess money, lowering the price of goods and lowering the interest rate.
C) People sell bonds to get rid of their excess money, lowering the price of bonds and lowering the interest rate.
D) People sell bonds to get rid of their excess money, raising the price of bonds and lowering the interest rate.
E) People buy bonds to get rid of their excess money, raising the price of bonds and lowering the interest rate.

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