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In the money market, the demand and supply of money determine the equilibrium nominal interest rate....

In the money market, the demand and supply of money determine the equilibrium

nominal interest rate.

mortgage interest rate.
inflation rate.
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Answer #1

If we talk about the money market then in this , the graph is plotted against normal interest-rate and the quantity of money or quantity of real money in the economy

Here the intersection point of money supply and money demand is called money market equilibrium and equilibrium point is the normal interest-rate

Here the inflation rate is totally irrelevant because it is talked when we talk about price indexes

So the correct answer here is option a

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