The Liquidity Preference Theory of Interest was propounded by
(A) J.M. Keynes
(B) David Ricardo
(C) Alfred Marshall
(D) Adam Smith
Correct Answer : J.M. Keynes
Question Asked : SSC CGL Tier-I Exam 2015
Explanation : In macroeconomic theory, liquidity preference refers to the demand for money, considered as liquidity. The concept was first developed by John Maynard Keynes in his book The General Theory of Employment, Interest and Money (1936) to explain determination of the interest rate by the supply and demand for money.
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