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Assume that the money demand function is (M/P) d = 2,200 - 200r, where r is the interest rate in percent. The money supply M is 2,000 and the price level P is2. If the price level is fixed and the Fed wants to fix the interest rate at 7 percent, it should set the money supply at:
A) 2,000.
B) 1,800.
C) 1,600.
D) 1,400.
In the long-run framework, deficits reduce: A. investment. B. taxes. C. government consumption. D. subsidies.
why lm curve upward sloping and is curve downward sloping?
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"The price of Brent crude oil has hit $111 a barrel and US crude also rose in price, as worries persist about the unrest in Libya". (BBC News, 2011) This quote, from the BBC news w
Because the structure of the personal income tax is progressive, a larger share of income is taxed at higher rates as real income increases. Therefore, economic growth automaticall
What is money wage rate While the money wage rate or nominal wage rate is the hourly wage rate calculated in money that a worker receives for supplying labour, the real wage r
why does the price level not enter desire consumption, investment and net exports of the desired aggregate expenditure function in the keynesian cross model
Assume an industry with one upstream and one downstream monopoly. The upstream monopoly produces Q , which is sold solely to the downstream monopoly. The downstream monopoly faces
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