-Refer to the Graph Above to Answer This Question

Multiple Choice

-Refer to the graph above to answer this question.If the interest rate is 8 percent what will people do?

A) Sell bonds which will cause bond prices to fall and the interest rate to fall.
B) Buy bonds which will cause bond prices to rise and the interest rate to fall.
C) Have insufficient liquidity which will cause them to reduce their spending on consumer goods.
D) Buy bonds which will cause bond prices to fall and the interest rate to rise.