When the price level ________,the demand curve for money shifts to the ________ and the interest rate ________,everything else held constant.
A)falls;right;rises
B)rises;right;falls
C)falls;left;rises
D)rises;right;rises

Question

Quizplus · Accepted Answer

When the price level rises, people need more money for transactions, shifting the demand curve for money to the right, which leads to an increase in the interest rate, assuming the money supply is constant.

When the Price Level ________,The Demand Curve for Money Shifts