According to the Liquidity Preference Model, the Equilibrium Interest Rate

question 28

Multiple Choice

According to the liquidity preference model, the equilibrium interest rate is determined by the:

• A) supply of and demand for loanable funds.
• B) supply of and demand for money.
• C) level of investment spending and saving.
• D) International Monetary Fund.

---

Definitions:

Blind Spot

An area of the visual field that lacks detection due to the absence of photoreceptor cells in the part of the retina where the optic nerve exits the eye.

Optic Nerve

Twin nerves that convey sight-related information from the retina to the brain.

Retina

A layer at the back of the eyeball containing cells that are sensitive to light and that trigger nerve impulses that pass via the optic nerve to the brain.

Wavelength

The distance between two consecutive crests or troughs in a wave, typically used in the context of electromagnetic waves such as light, sound, and radio.