According to the Theory of Liquidity Preference,money Demand

question 62

Multiple Choice

According to the theory of liquidity preference,money demand

• A)and the money supply are positively related to the interest rate.
• B)and the money supply are negatively related to the interest rate.
• C)is negatively related to the interest rate,while the money supply is independent of the interest rate.
• D)is independent of the interest rate,while money supply is negatively related to the interest rate.

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Definitions:

Shareholders' Equity

The residual interest in the assets of a company after deducting liabilities, representing the owners' claims on the company assets.

Total Assets

The sum of all resources owned by a company, valued at the cost, which can include cash, property, and equipment.

Total Liabilities

The sum of all financial obligations a company owes to external parties, including both short-term and long-term liabilities.

Total Liabilities

The aggregate of all debts and obligations owed by a company, reported on the balance sheet.