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In a third world country, the central bank wants to reduce the inflation rate by 5%. The current money supply is $2.0 trillion and the goal is to have equilibrium in the money market (Ms=Md). What should be the new target interest rate to reduce the inflation rate by 5% and to keep the money market in equilibrium? Use the quantity theory of money model (M*V=P*Y, or M*V=P*Q) and assume that V and Y (or Q) are constant. The estimated money demand function is given as: Md = 10-0.7i
Please show work and explain.
Explain by how much did GDP increase in 2007 and 2008 because of these transactions.
Europe has leveled off at Illustrate what fraction of GDP every capita in the United States.
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She gets pleasure not only from her spending money but also from her leisure hours. Draw her budget constraint in leisure-expenditure space.
Why do people routinely stuff themselves at all you can eat buffets Explain in terms of both utility also demand theories.
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