Question

From 2007 to 2008, the Federal Reserve System reduced interest rates, the price that borrowers pay. As a result, economists expected that the supply of money would:

Answer 1

The supply of money will increase the demand of money.

Step-by-step explanation:

The reason is that if the interest rate increase then it will increase the demand of the money and encourage investments which will further decrease the unemployment. This investment will also result in increased efficiency which will lower its price. This lowered priced product can now be exported to other countries which will increase the wealth of the country and help the country to resolve the balance of payment issues.