# Calculating equilibrium interest rate

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Suppose the total demand for money is described by the following equation:

MD = 30-2i

where i is the prevailing market interest rate. The total supply of money is described by the following equation:

MS = 3 + 7i

According to liquidity preference, what is the equilibrium interest rate?

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According to liquidity preference, equilibrium interest rate is ...

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Solution describes the steps to calculate equilibrium interest rate.

$2.49