試題詳解

30. Which of the following best describes the concept of liquidity trap?
(A) A person cannot withdraw money from his bank account because of the bank’s bankruptcy.
(B) A firm wants to invest money earned but cannot find projects worth investing in.
(C) A government has so much debt that it has to default.
(D) The interest rate is so low that people prefer holding cash.  Taiwanese Economics Olympiad