A study has estimated the effect of changes in interest rate

A study has estimated the effect of changes in interest rates and consumer confidence on the demand for money to be: In M-14666?021 C-0036 In r, where M denotes real money balances, C is an index of consumer confidence, and r is the interest rate paid on bank deposits. Based on this study we know that the interest elasticity is zero. very elastic O very inelastic O unitary

Solution

option c very inelastic

reason:

it doesnt change so much it remains same as like before

so intrest elasticity is very inelastic in this case