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Which of the Following Statements Is True If Interest Rates

Question 122

Multiple Choice

Which of the following statements is true if interest rates were zero?


A) The demand for bonds increases because bonds will be a more attractive alternative to money.
B) People will hold their wealth in the form of money rather than in bonds.
C) Bonds and money will become perfect substitutes since both are non-interest earning assets.
D) The supply of bonds will increase.

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