Archive | Money Market Equilibrium

The Equilibrium of Money: An Overview! Introduction: We will examine the decisions involving the allocation of wealth among different Assets. Thus, decision-making in this sector is called the money sector, because we concentrate on the allocation of wealth between money and all other assets — here we shall represent by bonds. We make this particular subdivision of the wealth sector [...]

Let us make in-depth study of the money market equilibrium in an economy. Introduction: Money market is in equilibrium when at a rate of interest demand for and supply of money are equal. It is worth noting that in the money market people increase or decrease the money they hold by selling short-term bonds that carry a fixed rate of [...]