Use the following to answer questions:
-(Figure: A Money Market)Refer to Figure: A Money Market.The equilibrium interest rate is:

Question

Use the following to answer questions: 
-(Figure: A Money Market)Refer to Figure: A Money Market.The equilibrium interest rate is:

Quizplus · Accepted Answer

The equilibrium interest rate is determined at the intersection of the money supply curve (MS) and the money demand curve (MD). In the given figure, the intersection point is at iS1U1B12, where the quantity of money demanded equals the quantity of money supplied.

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