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Category > Economics Posted 03 May 2017 My Price 7.00

Econ 201 5th Assignment

Econ 201 5th Assignment
Due date: Midnight of May 8th
Question The Federal Reserve (FED) expands the money supply by 5 percent.
a. Use the theory of liquidity preference to illustrate in a graph the impact
of this policy on the interest rate.
b. Use the model of aggregate demand and aggregate supply to illustrate
the impact of this change in interest rate on output and the price level in
the short run
c. When the economy makes the transition from its short-run equilibrium
to its long-run equilibrium, what will happen to the price level?
d. How will this change in the price level affect the demand for money and
the equilibrium interest rate?

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SuperTutor
(15)
Status NEW Posted 03 May 2017 05:05 AM My Price 7.00

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