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The factors determining movements in the general level of variable and fixed term interest rates in Australia

Essay specific features

 

Issue:

Business

 

Written by:

Emmanuel C

 

Date added:

December 30, 2015

 

Level:

University

 

Grade:

A

 

No of pages / words:

5 / 1303

 

Was viewed:

9957 times

 

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Essay content:

Demand of money Savings are the supply of money, and the demand of money means borrowing. Normally, supply of money has direct ratio with the interest rate. Once interest rate increases, supply of money will increase as well. In the opposite position, increase in interest rate leads to less borrowing...
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In the opposite position, increase in interest rate leads to less borrowing. The intersection of the supply and the demand curve for funds indicates the equilibrium point. If there is the rise on propensity to save, the supply curve of savings shifts to the right (S1) which leads to the lower interest rate, and vice versa (S2)...
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