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  • 03-03-2021
  • Business
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explain demand and supply of money​

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questions0204
questions0204 questions0204
  • 03-03-2021

The money demand curve is downward sloping, i.e., the demand for holding money increases with decrease in interest rates. The short-term interest rate (i) is determined by the equilibrium of the supply and demand for money. If the interest rates are above the equilibrium, there is excess supply of money.

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