Which of the following will increase the opportunity cost of holding cash? Reduce it? Have no effect? Explain.

a. Merchants charge a 1% fee on debit/credit card transactions for purchases of less than $50.

b. To attract more deposits, banks raise the interest paid on six-month CDs.

c. It’s the holiday shopping season and retailers have temporarily slashed prices to unexpectedly low levels.

d. The cost of food rises significantly.