Answer to Question #70610 in Macroeconomics for Siddharth

Question

What is interest sensitivity of money supply and how would you treat it algebraically ?

Answer 1

Interest rate sensitivity is a measure of how much the price of a fixed-income asset will fluctuate as a result of changes in the interest rate environment. Securities that are more sensitive have greater price fluctuations than those with less sensitivity.

Reference:
https://www.investopedia.com/terms/i/interest-rate-sensitivity.asp#ixzz4vn4LO7t2