People might withdraw money from interest-bearing accounts,
A)making the interest rate fall,if there is a surplus in the money market.
B)making the interest rate rise,if there is a surplus in the money market.
C)making the interest rate fall,if there is a shortage in the money market.
D)making the interest rate rise,if there is a shortage in the money market.

Question

Quizplus · Accepted Answer

When people withdraw money from interest-bearing accounts, it reduces the supply of money in the market, leading to a shortage. This shortage causes the interest rate to rise as banks try to attract more deposits.

People Might Withdraw Money from Interest-Bearing Accounts