if demand function for money is M/P = 0.5Y-100r, then the slope of LM curve is:...

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if demand function for money is M/P = 0.5Y-100r, then the slope of LM curve is:...

if demand function for money is M/P = 0.5Y-100r, then the slope of LM curve is:

a 0.05

b 0.001

c 0.005

d 0.01

business economics

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Answer 1

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Answer #1

The slope is found by rewriting the equation with \(r\) on one side and then the coefficient of \(y\) is the slope. Doing this for the given equation, we get that the slope is \(\frac{0.5}{100}=0.005\) which is option \(\mathrm{c}\) )

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if demand function for money is M/P = 0.5Y-100r, then the slope of LM curve is:...

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