Multiple Choice
The quantity of reserves demanded decreases as the federal funds rate rises because
A) people want more liquid assets as the federal funds rate rises.
B) the price of bonds rise as the federal funds rate rises.
C) the opportunity cost of holding excess reserves increases as the federal funds rate rises.
D) people want more money to invest as the federal funds rate rises.
Correct Answer:
Verified
Correct Answer:
Verified
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