Explore BrainMass
Share

Relationship Between the Money Supply and Interest Rates

This content was STOLEN from BrainMass.com - View the original, and get the solution, here!

Explain the mechanism that causes a shrinking money supply to result in a change in interest rates.

© BrainMass Inc. brainmass.com September 26, 2018, 12:45 am ad1c9bdddf - https://brainmass.com/economics/supply-and-demand/relationship-between-the-money-supply-and-interest-rates-515098

Solution Summary

This solution explains why a decrease in the money supply causes interest rates to increase.

$2.19