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In Chapter 15 of The General Theory of Employment, Interest, and Money, Keynes presents a theory of liquidity preference that distinguishes between the demand for money based on income and psychological factors. He categorizes motives for holding money into transactions, precautionary, and speculative demands, with the latter being influenced by expectations of future interest rates. Keynes concludes that changes in money supply affect interest rates and, consequently, output and employment, while emphasizi

Author

Anusha Saqib

Language

EN