Question

Can you please answer Part E only Thanks <3

Refer to the following chart (please note that the US does not publish a M3 measure of the money supply, and their nearest equivalent to it is M2) Monetary Base; Total, Dec 2007-100 M2 Money Stock, Dec 2007-100 -Consumer Price Index for All Urban Consumers: All Items, Dec 2007:100 520 480 440 400 360 x 320 280 240 200 160 120 80 2008 2010 2012 2014 2016 2018 Shaded areas indicate US. recessions Sources: BLS, Board of Governors myf.red/g/iMU8 a) Distinguish between the monetary base, the money supply and the consumer price index. In your own words, provide a brief definition of each of them. (3 marks) b) By how much did the monetary base increase between 2007 and 2014? What was the main cause of this increase in the US monetary base? (1.5 marks) c) By how much did the US money supply increase between 2007 and 2014? What does this tell us about the relationship between the monetary base and the money supply? (1.5 marks) d) By how much did the US price level increase between 2007 and 2014? What does this tell us about the relationship between the monetary base and the price evel? (1.5 marks) e) Distinguish between the quantity theory of money and the social conflict theory of inflation. Which appears to fit the data better, for the period 2007 to 2017? Explain your answer. (2.5 marks)