If the Central Bank sets the money supply independent of the interest rate, then the money supply curve is
Select one:
A. horizontal.
B. upward sloping
C. downward sloping.
D. vertical.
if we talk in simple terms then money supply curve represents the relationship between interest rate and quantity of money for any bank
From the given question if the central bank sets the money supply curve but the interest rate rate is independent which means it is zero
So the curve is horizontal in nature
When the quantity of money is fixed then the curve is vertical in nature
The correct answer here is option A
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