Explain the key tenets of the following Theories of Interest Rates and their implications in the functioning of the financial market in a modern economy 30 Marks Classical theory Liquidity preference theory Loanable funds theory Rational expectations theories Market segmentation theory

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Explain the key tenets of the following Theories of Interest Rates and their implications in the functioning of the financial market in a modern economy:

Explain the key tenets of the following Theories of Interest Rates and their implications in the functioning of the financial market in a modern economy: [30 Marks]

Classical theory
Liquidity preference theory
Loanable funds theory
Rational expectations theories
Market segmentation theory

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