If the money demand and money supply curves shift leftward,we can conclude that the equilibrium:

Question

Quizplus · Accepted Answer

If both money demand and money supply curves shift leftward, it means that the demand for money has decreased while the supply of money has also decreased at the same time. In this case, the equilibrium quantity of money will decrease, but we cannot predict the change in the equilibrium interest rate because it depends on which curve shifts more. If the decrease in demand for money is greater than the decrease in its supply, interest rates will rise. Conversely, if the decrease in the supply of money is greater than the decrease in its demand, interest rates will fall.

If the Money Demand and Money Supply Curves Shift Leftward,we