People are likely to want to hold more money if the interest rate
A) increases making the opportunity cost of holding money rise.
B) increases making the opportunity cost of holding money fall.
C) decreases making the opportunity cost of holding money rise.
D) decreases making the opportunity cost of holding money fall.

Question

Quizplus · Accepted Answer

When the interest rate decreases, the opportunity cost of holding money falls, making people more likely to hold onto their money rather than invest it for interest.

People Are Likely to Want to Hold More Money If