Results are out! Find what you Get quick advice or join the chat
Hey! Sign in to get help with your study questionsNew here? Join for free to post

Please ask me questions about anything related to A-level Economics

Announcements Posted on
Let our uni choice search tool match you with your perfect university 19-11-2015
  1. Offline

    I am interested in discussing Economics and also helping answer your questions. My background is in teaching Economics at the A-level.


  2. Offline

    Can you help me get my head around both Dis/Economies of Scales. The two terms confuse me a bit.

  3. Offline

  4. Offline

    Hi Ali,

    Thank you for being helpful.

    Can you help me with two doubts that I have regarding liquidity preference theory?

    Firstly, Is holding money in savings account considered "hoarding" money, i.e. a "demand for liquidity"? Was Keynes referring to piggy bank holding of money when he talked about liquidity preference in his book, or did he also mean savings account? Why some books regard putting money in savings/bank accounts as holding/hoarding money? I'm confused. Wouldn't the bank be able to make loans with those balances by Fractional reserve banking so how can that be considered as hoarding money?

    Secondly, one of the criticisms about the LP theory is that, just like what Keynes critcized of the Classical Loanable funds theory, the LP theory is indeterminate - like, before to find out the interest rate you need to know national income, and then to know NY you need to know Investment level which is in turn determined by i/r. I don't understand the fuzz about this. What exactly is determinacy of an economic theory? Are they not just estimations to understand what's going on? Are economic thoeries supposed to be determinate? Is the normal demand and supply theory or the monopoly firm theory considered determinate?

    I would appreciate even if you were to spare me some clues which I can further research from. Thank you so much!


Submit reply


Thanks for posting! You just need to create an account in order to submit the post
  1. this can't be left blank
    that username has been taken, please choose another Forgotten your password?
  2. this can't be left blank
    this email is already registered. Forgotten your password?
  3. this can't be left blank

    6 characters or longer with both numbers and letters is safer

  4. this can't be left empty
    your full birthday is required
  1. By joining you agree to our Ts and Cs, privacy policy and site rules

  2. Slide to join now Processing…

Updated: August 14, 2012
TSR Support Team

We have a brilliant team of more than 60 Support Team members looking after discussions on The Student Room, helping to make it a fun, safe and useful place to hang out.

Today on TSR

Find your perfect uni

Let us match you to your ideal course

What class are you?
Quick reply
Reputation gems: You get these gems as you gain rep from other members for making good contributions and giving helpful advice.