Task: Suppose you hear a commentator on the radio state that when interest rates fall, the stock market [the Dow Jones average say] tends to rise. {NOTE -- the question DOES NOT ask you to justify the statement, only to describe the graph.} Draw a graph of such a relationship for yourself.
a) What are the axes?
b) Describe the slope -- positive or negative? Why?
c) What factors would cause a movement along the graph?
d) What factors might cause a shift in the graph?