The following varies directly with the interest rate (a) the opportunity cost of holding money.
The correct option is (A).
When economists seek advice from the “opportunity cost” of a useful resource, they suggest the value of the following-maximum-valued opportunity use of that resource. If, for example, you spend money and time going to a movie, you can not spend that point at domestic analyzing a book, and also you cannot spend the money on something else.
Opportunity price is an economics term that refers to the fee of what you have to give up that allows you to pick out something else. In a nutshell, it's a value of the street not taken.
The opportunity value is time spent studying and that cash to spend on something else. A farmer chooses to plant wheat; the opportunity fee is planting a different crop, or an alternate use of the assets (land and farm equipment).
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