The opportunity cost of holding assets as money Suppose you've just inherited $10,000 from a relative. You're trying to decide whether to put the $10,000 in a non-interest-bearing checking account so that you can use it whenever you want (that is, hold it as money) or to use it to buy a U.S. Treasury bond. Suppose the interest rate on the bond is 8% per year. What would be the opportunity cost of holding the $10,000 as money? $10,000 per year $800 per year $8 per year $320,000 per year $741 per year Now, suppose that the interest rate rose to 9% per year. This would cause the opportunity cost of holding the $10,000 as money to _____ to _____ per year. What does the previous analysis suggest about the market for money? The quantity of money demanded increases as the interest rate rises. The supply of money is independent of the interest rate. The quantity of money demanded decreases as the interest rate rises