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4-1.1. What Is Money, and What Role Does It Play in the Economy?

Course video 21 of 25

The interest rate determines the exchange rate, the cost of capital, and the opportunity cost of using money. How is the interest rate determined? What factors drive the supply and demand for money? What constitutes money? What role do banks play in the monetary system? How do central banks influence the money market and the interest rate?

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