Decline, Processed, Apporved.
Answer: Option D
Explanation: In simple words, The theory of liquidity preference is a hypothesis that indicates that an investor will demand a higher interest rate or premium on long-term bonds with higher risk because, with all other factors being equal, investors prefer money or other highly liquid capital over other fixed securities.
This phenomenon occurs due to the fact that the interest rate in the market fluctuates heavily on daily basis due to it dependence on various different factors one of which is durability.
Hence from the above we can conclude that the correct option is D .
<span>In the long run, profits will equal zero in a competitive market because of free entry and exit.
Because there is free entry in a market, the competition can come and go as they please. This stops the ability for a company to have a monopoly because any company can come and sell the product. Companies are also able to leave a market but they may leave behind their goods without profit.
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