The equilibrium short-run interest rate is determined at the intersection of the demand and supply curves in the market for

Question

Quizplus · Accepted Answer

The market for money determines the equilibrium short-run interest rate. The demand for money comes from individuals and businesses seeking to borrow money, while the supply of money is determined by the central bank's monetary policy actions. The equilibrium short-run interest rate is the rate where the quantity of money demanded equals the quantity of money supplied.

The Equilibrium Short-Run Interest Rate Is Determined at the Intersection