Money demand-money supply and equilibrium interest rate

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Reference no: EM131377300

Carefully explain the impact on the money demand, money supply, equilibrium interest rate and the quantity of money due to each of the following: [Diagrams not required]

a) The changes in bank regulations expand the availability of credit cards so people need to hold less cash.

b) During a period of rapid inflation the central bank increases the reserve requirement.

c) The economy recently experienced an increase in the number of tourist arrivals,increasing income throughout the island.

d) Oil prices on the world market increase, causing domestic prices to increase.

Reference no: EM131377300

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