Which of the following is false?
A) The interest rate is determined by the supply of and demand for money.
B) Equilibrium occurs at the interest rate where the quantity demanded of money is equal to the quantity supplied.
C) Changes in the supply of or demand for money (shifts of the supply or demand curves) affect the interest rate.
D) Ceteris paribus, if quantity demanded increases, the interest rate rises and vice versa. Ceteris paribus, if quantity supplied increases, the interest rate falls and vice versa.
Correct Answer:
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