$$\begin{array} { | c | c | c | c | }
\hline \text { Money Supply } & \text { Money Demand } & \text { Interest Rate } & \begin{array} { c }
\text { Investment (at Interest } \
\text { Rate Shown) }
\end{array} \
\hline \$ 400 & \$ 600 & 2 \% & \$ 700 \
\hline \$ 400 & 500 & 3 & 600 \
\hline \$ 400 & 400 & 4 & 500 \
\hline \$ 400 & 300 & 5 & 300 \
\hline \$ 400 & 200 & 6 & 200 \
\hline
\end{array}$$ Answer the question based on the information in the table. The equilibrium interest rate in this economy is
A) 3 percent.
B) 4 percent.
C) 5 percent.
D) 6 percent.

Question

$$\begin{array} { | c | c | c | c | } 
\hline \text { Money Supply } & \text { Money Demand } & \text { Interest Rate } & \begin{array} { c } 
\text { Investment (at Interest } \
\text { Rate Shown) }
\end{array} \
\hline \$ 400 & \$ 600 & 2 \% & \$ 700 \
\hline \$ 400 & 500 & 3 & 600 \
\hline \$ 400 & 400 & 4 & 500 \
\hline \$ 400 & 300 & 5 & 300 \
\hline \$ 400 & 200 & 6 & 200 \
\hline
\end{array}$$ Answer the question based on the information in the table. The equilibrium interest rate in this economy is
A) 3 percent.
B) 4 percent.
C) 5 percent.
D) 6 percent.

Quizplus · Accepted Answer

The equilibrium interest rate is where the money supply equals money demand, which is at 4 percent according to the table.

Answer the Question Based on the Information in the Table