Business, 04.04.2020 05:16 Maxwell2539
Money demand in an economy in which no interest is paid on money is: StartFraction Upper B Superscript d Over Upper P EndFraction equals 500 plus 0.2 Upper Y minus 1000 i , where Y is real income and i is the nominal interest rate. a. Suppose that P = 50, Y =1 comma 250 , and i = 0.06. Calculate the following: Real money demand: nothing Nominal money demand: nothing Velocity: nothing (use whole numbers for the answers to both money demand questions but use two decimal places for the answer about velocity) b. The price level doubles from P = 50 to P = 100. Recalculate the values for these three variables: Real money demand: nothing Nominal money demand: nothing Velocity: nothing (use whole numbers for the answers to both money demand questions but use two decimal places for the answer about velocity)
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