Suppose the Federal Reserve has set the money supply at $4 million. The table below shows the interest rate and total demand for money. Interest Rate Demand (in millions) 20% $1 15 2 10 3 5 4 0 5 What is the equilibrium interest rate? Multiple Choice 0 percent 20 percent 10 percent 5 percent

Suppose the Federal Reserve has set the money supply at $4 million. The table below shows the interest rate and total demand for money. Interest Rate Demand (in millions) 20% $1 15 2 10 3 5 4 0 5 What is the equilibrium interest rate? Multiple Choice 0 percent 20 percent 10 percent 5 percent

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter16: Interest, Rent, And Profit

Section: Chapter Questions

Problem 7QP

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Question

Suppose the Federal Reserve has set the money supply at $4 million. The table below shows the interest rate and total demand for money.

Interest Rate	Demand (in millions)
20%	$1
15	2
10	3
5	4
0	5

What is the equilibrium interest rate?

Multiple Choice

0 percent
20 percent
10 percent
5 percent

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