In Keynes' concept of the liquidity trap,
A) monetary policy becomes more effective as interest rates fall below normal.
B) people wish to hold more bonds as interest rates fall below normal.
C) people wish to hold fewer bonds as interest rates fall below normal.
D) there is a need for more liquidity in the banking system.
C
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Which of the following is true?
a. Competitive forces are present even in markets with high barriers to entry. b. Quality competition is an unimportant element of the competitive process. c. Profitability and high prices discourage technological change and the development of substitute products. d. Government regulations have substantially increased the quality of American manufacturing products in recent years.
Explain the difference between comparative advantage and absolute advantage and which concept should be used to make trade decisions.
What will be an ideal response?