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Uploaded on Wednesday 24 June, 2020 to the illusion of money |
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The components impacting interest rates |
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There are various factors which can affect interest rates. When viewed as a price point which fluctuates according to market forces, the conclusion is reached that interest rates reflect the rental price for money. When the economy expands through the injection of liquidity, the supply of money goes up and the price of interest rates is lowered. When lending goes up, the price of interest rates is increased to reflect the demand for loans. This tutorial showcases the ways in which the supply and demand impact interest rates.
This video is courtesy of the Khan Academy whose YouTube channel is available here. |
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