Question

The opportunity cost of holding money Group of answer choices varies inversely with the interest rate. varies directly with the interest rate. varies inversely with the level of economic activity. s zero because money is not an economic resource.

Answer 1

Answer:

Varies directly with the interest rate.

Explanation:

Varies directly with the interest rate.

The opportunity cost of holding the money will be the earning that can be made by investing the money. Basically, it is the interest rate that an investment provides when money is invested. If the money is not invested and it just held then the interest rate that could be earned is the opportunity cost.