The demand for money is low and the amount of money in the money supply is decreasing B. Interest rates are high.
Which of the following decreases the money supply?
By lowering the reserve requirements, banks are able to loan more money, which increases the overall supply of money in the economy. Conversely, by raising the banks' reserve requirements, the Fed is able to decrease the size of the money supply.
What happens in the money market when there is a decrease in the supply of money?
When the supply of money is increased by the central bank, the supply curve for money shifts to the right, leading to a lower interest rate. When the supply of money falls, the money supply curve shifts leftward, which leads to a higher interest rate
When all else is equal, the inverse relationship between a country's money supply and short-term interest rates make it either more or less expensive for consumers to borrow. So when there is a greater supply of money, interest rates are lower.
To learn more about supply of money, refer
https://brainly.com/question/3625390
#SPJ2
