In the liquidity preference model, the money supply is represented by:

Name: In the liquidity preference model, the money supply is represented by:
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In the liquidity preference model, the money supply is assumed to be fixed by the central bank and is represented by a vertical line. This is because changes in interest rates do not affect the supply of money in the short run, as it is determined solely by the central bank's actions.

In the Liquidity Preference Model, the Money Supply Is Represented