Q3. WHAT ARE THE 4 COMMON DEFINITIONS OF MONEY? WHAT ARE THE 2 TYPES OF MONEY...
Q3. WHAT ARE THE 4 COMMON DEFINITIONS OF MONEY? WHAT ARE THE 2 TYPES OF MONEY DEMAND? WHAT IS MONEY DEMAND?WHAT IS MONEY SUPPLY? HOW DO YOU ACHIEVE EQUILIBRIUM?
Homework Answers
1) definition :
a) a medium of exchange,
b) a common measure of value
c) standard of deferred payment,
d) a store of value
2) transaction demand
Speculative or assets demand
3) money demand: it is amount of assets individuals wish to hold in the form of money at a moment of time.
4) money supply : it is the money circulating in the economy or total value of money present at any point of time in the economy.
5) by doing quantity of money supply and money demand equal ,we can achieve equilibrium condition.
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Q3. WHAT ARE THE 4 COMMON DEFINITIONS OF MONEY? WHAT ARE THE 2
TYPES OF MONEY...
What is the main difference between the M1 and M2 definitions of the money supply? Why...
What is the main difference between the M1 and M2 definitions of the money supply? Why does the Federal Reserve use two definitions of the money supply rather than one?
4. If nominal money demand doubles and the real money supply also does what happens to...
4. If nominal money demand doubles and the real money supply also does what happens to the price level ( ). The price level increases by a factor of four b. The price level doubles ). The price level is unchanged. d. The price level falls by one-half. IL Short-Answer O stiens (19 points) 5. (7 points) If the Federal Reserve sold government securities, then the money supply (increase decrease remain the same), the money he would _(increase decrease remain...
2. The demand for money is: Mº = PYL (1), where P is the price level,...
2. The demand for money is: Mº = PYL (1), where P is the price level, Y is the real GDP and L () is an inverse function of the rate of interest (i.e. when i increases, L (1) decreases, and vice versa). Money supply is: M$ = mH, where H is the high-powered money issued by the central bank and m is the money multiplier. (a) Draw the money demand and supply curves on a graph with money demand...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money demand schedule, which is the quantity of money demanded at various price levels (P). Fill in the Value of Money column in the following table. Now consider the relationship between the price level and the quantity of money that people demand. The lower the price level, the _______ money the typical transaction requires, and the _______ money people will wish to hold in the form of currency...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money demand schedule, which is the quantity of money demanded at various price levels (P). Fill in the value of Money column in the following table. Price Level (P) Value of Money (1/P) Quantity of Money Demanded (Billions of dollars) 2.0 1.00 1.33 2.5 4.0 2.00 4.00 8.0 money the Now consider the relationship between the price level and the quantity of money that people...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money demand schedule, which is the quantity of money demanded at various price levels (P Fill in the Value of Money column in the following table. Price Level (P) 0.80 1.00 1.33 Quantity of Money Demanded Billions of dollars) 2.0 2.5 4.0 8.0 Value of Money (1/P) Now consider the relationship between the price level and the quantity of money that people demand. The lower...
Q1. Explain the types of depreciating tangible assets. Q2. Explain provisions and its common types. Q3....
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2. The following are the money demand and money supply functions in an economy. M=8,000 :...
2. The following are the money demand and money supply functions in an economy. M=8,000 : M-25000(0.4-i) Answer the following questions: (a.) Calculate the equilibrium interest rate. (5%) (6.) Suppose the central bank falls the equilibrium interest rate to 5%, will there be excess money supply or money demand? What monetary policy should be followed to reach the new equilibrium interest rate ? (5%)
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money demand schedule, which is the quantity of money demanded at various price levels (P). Fill in the value of Money column in the following table. Quantity of Money Demanded (Billions of dollars) Price Level (P) 1.00 1.5 Value of Money (1/P) 1.00 0.75 0.50 2.0 1.33 2.00 4.00 3.5 7.0 0.25 money Now consider the relationship between the price level and the quantity of...
1. What are the most common types of sugars in your diet? 2. How do sugar...
1. What are the most common types of sugars in your diet? 2. How do sugar molecules provide us with energy? 3. What is the role of sugar in human evolution? 4. What are the dangers of consuming excess sugar? 5. In terms of sugar consumption, what are potential dangers of processed foods and low-fat foods? 6. What other molecules (besides sugars) serve as a source of energy for our bodies? 7. Analyze your diet and life-style and make specific...
4. If nominal money demand doubles and the real money supply also does what happens to the price level ( ). The price level increases by a factor of four b. The price level doubles ). The price level is unchanged. d. The price level falls by one-half. IL Short-Answer O stiens (19 points) 5. (7 points) If the Federal Reserve sold government securities, then the money supply (increase decrease remain the same), the money he would _(increase decrease remain...
2. The demand for money is: Mº = PYL (1), where P is the price level, Y is the real GDP and L () is an inverse function of the rate of interest (i.e. when i increases, L (1) decreases, and vice versa). Money supply is: M$ = mH, where H is the high-powered money issued by the central bank and m is the money multiplier. (a) Draw the money demand and supply curves on a graph with money demand...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money demand schedule, which is the quantity of money demanded at various price levels (P). Fill in the value of Money column in the following table. Price Level (P) Value of Money (1/P) Quantity of Money Demanded (Billions of dollars) 2.0 1.00 1.33 2.5 4.0 2.00 4.00 8.0 money the Now consider the relationship between the price level and the quantity of money that people...
2. Money supply, money demand, and adjustment to monetary equilibrium The following table shows a money demand schedule, which is the quantity of money demanded at various price levels (P Fill in the Value of Money column in the following table. Price Level (P) 0.80 1.00 1.33 Quantity of Money Demanded Billions of dollars) 2.0 2.5 4.0 8.0 Value of Money (1/P) Now consider the relationship between the price level and the quantity of money that people demand. The lower...
2. The following are the money demand and money supply functions in an economy. M=8,000 : M-25000(0.4-i) Answer the following questions: (a.) Calculate the equilibrium interest rate. (5%) (6.) Suppose the central bank falls the equilibrium interest rate to 5%, will there be excess money supply or money demand? What monetary policy should be followed to reach the new equilibrium interest rate ? (5%)
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