Suppose Present Interest Rates Are Relatively High

Multiple Choice

Suppose present interest rates are relatively high. Financial investors will hold

A) smaller speculative balances because they expect bond prices to fall further.
B) larger speculative balances because they expect bond prices to fall further.
C) smaller speculative balances because they do not expect bond prices to fall further.
D) larger speculative balances because they do not expect bond prices to fall further.