3-Chp5-Econ3310 - Bond Market Equilibrium Interest Rates...

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Unformatted text preview: Bond Market Equilibrium Interest Rates Market for Money: LPF Equilibrium Interest Rates in LPF 2. Market for Money: The Liquidity Preference Model 1. Bond Market Two Approaches: To understand the behavior of interest rates, we need to look at the demand and supply for assets. In equilibrium, market prices equate demand and supply. Interest rates are closely related to market asset prices. Interest rates fluctuate considerably. The Behavior of Interest Rates Asset Demand ...
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This note was uploaded on 02/14/2012 for the course ECON 3310 taught by Professor Dix during the Fall '08 term at York University.

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