Charisse is of the opinion that the interest rate depends on the economy's saving propensities and investment opportunities.Most economists would say that Charisse's opinion is
A)Keynesian in nature,and that her view is more valid for the long run than for the short run.
B)classical in nature,and that her view is more valid for the long run than for the short run.
C)Keynesian in nature,and that her view is more valid for the short run than for the long run.
D)classical in nature,and that her view is more valid for the short run than for the long run.

Question

Quizplus · Accepted Answer

Charisse's opinion aligns with classical economics, which asserts that interest rates are determined by the supply and demand for loanable funds, which are in turn affected by saving and investment decisions. Classical economics emphasizes the long-term trends of the economy, and the relationship between saving and investment is expected to hold true in the long run.

Charisse Is of the Opinion That the Interest Rate Depends