Ask Question
4 February, 07:09

1. What is the relationship between liquidity and the interest rates?

+4
Answers (1)
  1. 4 February, 08:02
    0
    Liquidity Effect. When the Fed pursues a tight monetary policy, it takes money out of the system by selling Treasury securities and raising the reserve requirement at banks. This raises interest rates because the demand for credit is so high that lenders price their loans higher to take advantage of the demand.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “1. What is the relationship between liquidity and the interest rates? ...” in 📙 Computers & Technology if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers