ge 16: 32 ge 17: 5 -- 1 ge 18: 34 36 BE ge 19: Interest MN 34 24 11 0 100 200 300 400 500 600 Quantity of Money ($ billions) D If the interest rate was 8 percent, people would: sell bonds, which would cause bond prices to fall and the interest rate to fall buy bonds, which would cause bond prices to rise and the interest rate to fall have insufficient liquidity, which would cause them to reduce their spending on consumer goods buy bonds, which would cause bond prices to fall and the interest rate to rise sell bonds, which would cause bond prices to fall and the interest rate to rise Previous Page Next Page Page 16 of 25