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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

In the financial market, what causes a movement along the demand curve? What causes a shift in the demand curve?

To determine

In the Financial market, what causes a movement along the demand curve and shift in the demand curve.

Explanation

In the Financial market those who borrow money are on the demand side will pay interest rate for using the money. Thus In financial market, quantity demanded of product is replaced by quantity demanded of money and price is replaced by rate of return or interest rate. More is the Interest rate, less is the quantity demanded of money and vice versa. Hence it causes movement along the same demand curve...

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