Can someone please explain me the answer and illustrate in graphically? I have no clue... When...
Can someone please explain me the answer and illustrate in graphically? I have no clue...
When the economy is at a point above the IS curve but below the LM curve, this economy
has:
a. Excess supplied of goods but excess demand for money
b. Excess demand for goods but excess supplied of money
c. Excess demand for both goods and money
d. Excess supplied of both goods and money
e. Excess demand for goods but the money market is in equilibrium
Homework Answers
a. Excess supplied of goods but excess demand for money
IS curve represent different combination of income and interest rate where goods market is in equilibrium. To the right of IS curve, there will be excess supply of good i.e. Y > AD.
LM curve represents different combination of income and interest rate at which money market is in equilibrium. To the right of LM curve there will be excess demand for money.
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Can someone please explain me the answer and illustrate in
graphically? I have no clue...
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Please box answers! Thank you. 11. Monetary policy and the LM curve Aa Aa The following graph shows the demand and supply of real money balances in a hypothetical economy. Use the black point (X point...
Please box answers! Thank
you.
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1. Suppose that the initial demand and supply curves for coffee are illustrate by D' and...
1. Suppose that the initial demand and supply curves for coffee are illustrate by D' and St in the graph below. Assume that coffee and kringle are complements in consumption. Clearly label all additions to the graph. a) Suppose that the initial market price of coffee, Po, is $1 per cup (Po = $1). Determine and illustrate the quantity demanded at Po (labeled as Qc), and the quantity supplied at Po (labeled as Qoʻ). Show Qoand Qos on the quantity...
Hi! Can someone explain how to to answer the problem? I have tried but I am...
Hi!
Can someone explain how to to answer the problem? I have tried but
I am confused on how to write it?
Assume that a competitive market is currently represented by the following supply and demand equations: Qs P 20 Qd 110-0.5P 1. (2 Points) Solve for the equilibrium price and quantity. 2. (1 Point) Solve for the price elasticity of demand. 3. (4 Points) Graph the market equilibrium. Fully label the graph.
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1)...
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The LM curve represents A) the single level of output where the goods market is in equilibrium. B) the combinations of output and the interest rate where the goods market is in equilibrium. C) the single level of output where financial markets are in equilibrium. D) the combinations of output and the interest rate where the money market is in equilibrium. E) none of...
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The...
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The LM curve represents A) the single level of output where the goods market is in equilibrium. B) the combinations of output and the interest rate where the goods market is in equilibrium. C) the single level of output where financial markets are in equilibrium. D) the combinations of output and the interest rate where the money market is in equilibrium. E) none of the...
NEED HELP WITH QUESTIONS E TO I Consider a hypothetical economy characterized by the following equations(all...
NEED HELP WITH QUESTIONS E TO I
Consider a hypothetical economy characterized by the following
equations(all variables as defined in class).
Consumption: C = 700 + 0.95Y Investment: I=500− 30i
Government spending: G=50
Money demand: L(i,Y )=0.75Y − 30i Money supply: Ms/P=400
(a) What is the equation of the IS curve?
(b) What is the equation for the LM curve?
(c) Solve for the equilibrium values of income (Y) and interest
rates (i).
(d) Assume that the government engages in...
Please answer G and H fully! Both graphically and explain in words! 1) Imagine that you work for a firm that sells good...
Please answer G and H fully! Both graphically and explain in
words!
1) Imagine that you work for a firm that sells good x in a perfectly competitively market You know that you are one of 100 firms in this market and that they all have the same short run individual supply function q 2 P-0.5 P1 +0.5 K You also know that there is only one type of consumer, that there are 100,000 of them in the market, and...
Financial markets and the LM relation. a) Explain why the money demand curve is downward sloping and what b) What types of policies can the central bank implement to reduce the interest c) Define the velocity of money. What effect does an increase in interest rate d) Illustrate graphically the effect of a drop in nominal income on the money e) Illustrate graphically the effect of a purchase of bonds by the Federal Reserve factor(s) cause shifts in the money...
1. Labour Market. Draw a diagram of the labour market where there above the equilibrium level. Use I to denote the amount of labour to denote the amount of labour hired. bour market where the real wage is stuck note the amount of labour willing to work and L1 Now suppose there is an increase in technology that raises the demand the new demand curve and explain what happens to the and curve and explain what happens to the number...
Please box answers! Thank
you.
11. Monetary policy and the LM curve Aa Aa The following graph shows the demand and supply of real money balances in a hypothetical economy. Use the black point (X point) to indicate the equilibrium in this market. Dashed drop lines will automatically extend to both axes. REAL INTEREST RATE [Percent) 10 Equilibrium Supply New Supply New Equilibrium Demand 3 0 10 20 30 40 50 60 70 80 90 100 REAL MONEY BALANCES Help...
1. Suppose that the initial demand and supply curves for coffee are illustrate by D' and St in the graph below. Assume that coffee and kringle are complements in consumption. Clearly label all additions to the graph. a) Suppose that the initial market price of coffee, Po, is $1 per cup (Po = $1). Determine and illustrate the quantity demanded at Po (labeled as Qc), and the quantity supplied at Po (labeled as Qoʻ). Show Qoand Qos on the quantity...
Hi!
Can someone explain how to to answer the problem? I have tried but
I am confused on how to write it?
Assume that a competitive market is currently represented by the following supply and demand equations: Qs P 20 Qd 110-0.5P 1. (2 Points) Solve for the equilibrium price and quantity. 2. (1 Point) Solve for the price elasticity of demand. 3. (4 Points) Graph the market equilibrium. Fully label the graph.
NEED HELP WITH QUESTIONS E TO I
Consider a hypothetical economy characterized by the following
equations(all variables as defined in class).
Consumption: C = 700 + 0.95Y Investment: I=500− 30i
Government spending: G=50
Money demand: L(i,Y )=0.75Y − 30i Money supply: Ms/P=400
(a) What is the equation of the IS curve?
(b) What is the equation for the LM curve?
(c) Solve for the equilibrium values of income (Y) and interest
rates (i).
(d) Assume that the government engages in...
Please answer G and H fully! Both graphically and explain in
words!
1) Imagine that you work for a firm that sells good x in a perfectly competitively market You know that you are one of 100 firms in this market and that they all have the same short run individual supply function q 2 P-0.5 P1 +0.5 K You also know that there is only one type of consumer, that there are 100,000 of them in the market, and...
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