Unit 4. 1 1. Which of the following will happen when interest rates rise in an economy? A. The cost of borrowing will decrease B. The spending multiplier will decrease C. Investment spending will increase D. The price of previously issued bonds will increase E. The opportunity cost of holding money will increase 2. Which of the following is true for bonds but not for stocks? A. Bonds are the least liquid form of assets B. Bonds represent partial ownership in a company C. Bonds earn variable rates of return D. Bonds are interest-bearing assets E. Bonds have zero opportunity cost