Which of the following statements about interest rate determination is most accurate?
a. In both the long run and the short run, the interest rate is determined in the market for loanable funds.
b. In both the long run and the short run, the interest rate is determined in the money market.
c. In the short run the interest rate is determined in the market for loanable funds, and in the long run it is are determined in the money market.
d. In the short run the interest rate is determined in the money market, and in the long run it is determined in the market for loanable funds.
e. The interest rate is determined through an interaction between the money market and the loanable funds market.
D
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