If the quantity of money demanded exceeds the quantity supplied:
A. the supply-of-money curve will shift to the left.
B. the demand-for-money curve will shift to the right.
C. the interest rate will rise.
D. the interest rate will fall.
C. the interest rate will rise.
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If a salesperson is paid by the volume of sales he or she makes, then the
A) moral hazard problem is diminished. B) moral hazard problem is enhanced. C) adverse selection problem is enhanced. D) None of the above answers is correct.
"Mediocre economists often consider only the immediate direct effects of a change, whereas a good economist will also consider indirect effects that may only become observable over time." This statement most clearly emphasizes
A) the law of comparative advantage. B) economizing behavior. C) the importance of secondary effects. D) the gains derived from voluntary exchange.