Answer:
a. decreases, so the quantity of money demanded increases
Explanation:
When the value of money decreases there will naturally be high demand for money because the opportunity cost of holding cash is very low.
The opportunity cost of holding money is the interest that is forgone, when price level increases, the value of money falls and the demand for money increases.
When the value of money increases as a result of high interest rate, it reduces our liquidity preference and the demand for money will decrease.
