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Suppose that the economy is shown to the right. This economy is currently experiencing O A. a recessionary gap. O B. an inflationary gap. O C. deflation. LRAS SRAS O D. crowding out Using the line drawing tool, draw and label the fiscal policy correction that would bring the economy to full employment GDP Properly label this line. Carefully follow the instructions above, and only draw the required objects AD 2 4 6810 12 14 16 18 20 Real GDP (S trillions)
Consider a world in which there is no currency and depository institutions issue only transactions deposits and desire to hold no excess reserves. The required reserve ratio is 15 percent. The central bank sells $1.01 billion in government securities This results in V the money supply of Sbillion. (Enter your response rounded to two decimal places)
Suppose that the total liblities of a depository institution are transactions deposits equal to $3 billion. it has $2.25 billion in loans and securities, and the required reserve ratio is 15 percent Calculate this institutions excess reserves. S millions.
Assume that the required reserve ratio is 8 percent. What is the total possible expansion of the money supply after a $2 5 million bond purchase by Fed? s(Round your answer to the nearest dollar,) the
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The infla henavy mp This berae ha economy is adueing e cono my is Crenty experien cing and abou th。h1! emplogment, equil ; buium . See the tre in tersectton of SRAS and Ab LPAs. And if ur dnaus gin, frorn tho intersec tion Pointe ses that the l emplayment utpt see that the lpt is is oe can Sce Bost th lpt is excreding by z rhis implres an in fla tianary gap i tis eano nu exe严edin in he long the xpectadions albt ta prices ariU changeもecause the pnice eSee at the in kensechnot SPA and AD s igher thanhe price al e. inten seckan o leAs e and AD. Thone o inereae and he expectahms hat ucer in the Autare inerease so hy silt demand kighen wages and te pices at rodl in the econamtsill increase in His way thisrevision in xpec tatian a about Auicest mate the SPAs shirt to le vea sing prices and decrea Sing eeilibo tum Quantidy llhefal1 employment is reache d See i in re graph belousLRAS SRAS Y*palicy silt esult in a asit つ7he above increase in meney Suppl 101 billion x (V o. IS 구ㅇ 구 billion -) Total peaksi li her: $ 3 billion loans and Secites2s laill n Required reser uerah,o 15 calcula tian ot excessunesen ve legal ure ser ves a liailibes loan and secuuities ratio Totaf na bilihen oes enver:IS./. 아饣2 billion RepairedThere fore Excess e sem ves- ta-25- to-45 billion Excess e senves is t 3000 illions Reied esenve ratto. money multiplien : 1/YY=1/o-op:125 Increase in deposits aplen bond piuchase2 s mi llim Thus, to tal in crease in mne Suppl (r)(total deposit) (2.52 s 211. 31, 25 mill? Hience, toal io cyease in mae supply $31 s millian

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