The money market equilibrium is defined as_________
ECONOMICSJAMB 2019
The money market equilibrium is defined as_________
- A. when the demand and supply of money are equal
- B. when demand is greater than supply of money
- C. when demand is less than supply of money
- D. when supply is greater than demand for money
Correct Answer: A. when the demand and supply of money are equal
Explanation
The money market is in equilibrium when the demand & supply of money are equal i.e L = μ where L = money demand, μ = money supply Thus μ = LT(γ) + Ls(r)
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