The equilibrium rate of interest is determined by
A)Money demand and money supply.
B)The U.S.Treasury.
C)The president of the Federal Reserve Bank of New York.
D)The Federal Closed Market Committee.

Question

Quizplus · Accepted Answer

The equilibrium rate of interest is determined by the interaction of money demand and money supply in the economy. When money supply and money demand are equal, it creates a stable interest rate that represents the equilibrium rate.

The Equilibrium Rate of Interest Is Determined by