How Does the Interest Rate Change When the Price Level

Multiple Choice

How does the interest rate change when the price level falls and when the money supply falls?

A) The interest rate rises both when the price level falls and when the money supply falls.
B) The interest rate rises when the price level falls and falls when the money supply falls.
C) The interest rate falls when the price level falls and rises when the money supply falls.
D) The interest rate falls both when the price level falls and when the money supply falls.