Q. If there is a general shortage of liquidity in the money market then ?
a. The banks will increase their lending
b. The short-term interest rate at which the economy’s commercial banks lend to and borrow from each other will fall and the central bank may be expect
c. The short-term interest rate at which the economy’s commercial banks lend to and borrow from each other will rise and the long-term interest rate ma
d. the long-term interest rate in the economy will rise and the central bank will raise its interest rate in response
e. The short-term interest rate at which the economy’s commercial banks lend to and borrow from each other will rise and the central bank may be expect
ANSWER: The short-term interest rate at which the economy’s commercial banks lend to and borrow from each other will rise and the central bank may be expect
Answer & Explanation
No explanation is available for this question!
