Sunday, March 29, 2015

Unit 4 Money Market

 

The money market graph allows us to essentially compare the money supply of the economy to the money demanded. The money demanded is the most liquid forms of money. Essentially, it’s the cold hard cash–the dollar bills and the silver in our pockets. The money market graph allows us to evaluate the effects of money demand and money supply and their relation to the nominal interest rates of an economy.

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