According to the theory of liquidity preference, how is the money supply affected by the interest rate?
A) inversely
B) negatively
C) not affected
D) directly

Name: According to the theory of liquidity preference, how is the money supply affected by the interest rate? A) inversely B) negatively C) not affected D) directly
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Question

Quizplus · Accepted Answer

According to the theory of liquidity preference, the money supply is determined by the central bank and is not directly affected by the interest rate.

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