Great answer! Dutifully, he communicates their response in the conclusion of the same verse:
. . .and Moses reported the words of the people unto the Lord (Ex. 19:8)
But wait, there is a problem. Because after G-d then replies by explaining to Moses that G-d will appear in a thick cloud before the people so that they will believe him forever, the next verse concludes
. . .and Moses told the words of the people unto the Lord (Ex. 19:9)
Virtually the same as in the verse before!
So, the rabbis here ask:
Now, what did the Holy One, Blessed be He, say unto Moses, what did Moses say unto Israel, what did Israel say to Moses, and what did Moses report before the Omnipotent?
That is to say, what happened between these two verses that Moses had to report to G-d twice?!
It seems that even though they initially responded positively, there was some hesitation. And maybe, it was Moses’ fault for the way he communicated:
Rabbi said: At first he explained the penalties [for non-observance], for it is written, 'And Moses reported [va-yashev]', [which implies] things which repel [meshabbebin] one's mind.
Rashi says this means they were threatened with the penalties for disobedience. Evidently this didn't go over so well.
But subsequently he explained its reward, for it is said, 'And Moses told [va-yagged]', [which means,] words which draw one's heart like a story [aggadah].
So there are two lessons of pedagogy:
1. threats are not effective in getting buy-in,
2. narrative stories are!