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Assume that prices and wages adjust rapidly so that the markets for labor, goods, and assets are always in equilibrium. What are the effects of each of the following on real money demand and the current price level? Explain in words.
(a) A temporary increase in government purchases.
(b) A reduction in expected inflation.
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On January 1, 2010, Jacob issues $800,000 of 9%, 13-year bonds at a price of 96½. Six years later, on January 1, 2016, Jacob retires 20% of these bonds by buying them on the open m
Budgetary Control is a technique of managerial control through budgets. Elaborate.
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